tDWAQDj=ADAn5 


;i 


THE 


MODERN  FARMER 


IN  HIS 


BUSINESS    RELATIONS. 


A  Study  of  some  of  the  Principles  underlying  the  Art  of  Profit- 
able Farming  and  Marketing,  and  of  the  Interests  of 
Farmers  as  affected  by  modern  Social 
and  Economic  Conditions 
and  Forces. 


By  EDWARD  F.  ADAMS 


With  a  Chapter  by  Mr.  L.  A.  Clinton,  of  the  College  of  Agriculture  in 
Cornell  University. 


N.    J.    STONE    COMPANY 

SAN   FRANCISCO,    CAL. 
1899 

ALL   RIGHTS   RESERVED 


Entered  According  to  Act  of  Congress,  in  the  Year  1899,  by 

Edward  F.  Adams 

In  the  Office  of  the  Librarian  of  Congress,  at  Washington,  D.  C. 

All  Rights  Reserved. 


PREFACE, 


WHEN,  after  a  business  experience  extending  over  a 
quarter  of  a  century,  I  became  interested  in  coopera- 
tive work  among  farmers,  and  sought,  as  an  officer  of 
cooperative  societies,  to  induce  farmers  to  unite  for  business 
purposes,  I  discovered  that  there  were  no  grounds,  common  to 
myself  and  those  whom  I  addressed,  upon  which  to  base  the 
proposed  action.  My  audiences  and  constituents  believed  so 
much  which  I  knew  to  be  untrue  as  to  greatly  impair  the 
effectiveness  of  my  leadership.  This  condition  was  so  vexing 
that  I  gradually,  durhig  three  or  four  years  of  that  work,  pre- 
pared, largely  upon  railroad  trains,  the  most  of  the  chapters 
which  comprise  this  volume.  Later,  some  chapters  were  ampli- 
fied, and  others  added.  If  I  had  happened  to  be  one  who 
had  had  unusual  experience  in  raising  cabbages,  I  was  sure 
that  my  brother  farmers  would  have  much  respect  for  what  I 
might  say  about  methods  of  growing  them.  I  hoped  that  I 
might  have  the  same  influence  as  one  who  had  happened  to 
have  a  wider  business  experience  than  falls  to  the  lot  of  most 
farmers.     As  to  that,  however,  I  have  some  doubt. 

I  pretend  to  no  great  knowledge  of  economic  science,  but 
understand  it  to  be  plain  common  sense  applied  to  such  busi- 
ness transactions  as  marketing  produce,  borrowing  money,  and 
voting  upon  a  tariff.  Common  sense,  of  course,  is  the  logical 
inference  from  all  the  facts.  Inference  from  only  part  of  the 
facts,  or  from  "facts  that  ain't  so,"  is  not  common  sense, 
although,  unfortunately,  common  practice.  No  one  appre- 
ciates more  highly  than  myself  the  value  of  the  study  of  the 
fundamental  economic  concepts,  but,  after  all,  the  world's 
business  must  be  done  mostly  by  those  without  fixed  convic- 
tions as  to  the  real  meaning  of "  value,"  or  the  ''fund"  from 
which  wages  are  paid.  I  have,  therefore,  written  for  that  class, 
drawing  my  conclusions  inductively  from  experiences  common 
to  myself  and  my  readers,  rather  than  deductively  from  the 


622133 


economic  bases.  I  trust,  however,  that  I  have  written  in  the 
scholarly  spirit,  and  not  to  establish  a  thesis.  Upon  some 
controverted  topics  I  have  thought  best,  without  expressing 
my  own  opinion,  to  present  the  essence  of  the  argument  on 
both  sides.  I  have  tried  to  do  so  fairly,  and  think  I  have 
succeeded.  There  are,  however,  popular  delusions  which  have 
taken  strong  hold  upon  many  excellent  men,  as  to  which  I 
felt  that  one  has  no  right  to  suppress  convictions  approved 
by  universal  business  experience,  and  the  teaching  of  all 
economists. 

Having  prepared  the  book  mainly  for  farmers,  I  was  desir- 
ous that  farmers  should  read  it.  The  farmer,  however,  is 
seldom  a  free  book  buyer,  and  I  was  persuaded  that,  except  by 
the  kindly  ministrations  of  the  canvasser — a  capacity  in  which 
I  began  my  own  business  life — the  most  of  those  for  whom  the 
book  was  especially  intended  would  never  see  it.  I  therefore 
decided  to  publish  by  subscription. 

Possibly  it  is  desirable  that  an  unknown  author  should 
state  his  experience,  and  the  environment  wliich  influences 
him.  I  was  once  a  farmer  of  the  old  school,  and  led  the  life 
described  in  the  first  chapter  of  this  volume.  Then  followed 
twenty-five  years  of  business  life,  for  the  most  part  dealing  with 
affairs  of  some  magnitude.  Then,  retiring  from  business,  were 
three  years  of  active  cooperative  work.  I  now  live  upon  my 
farm,  where  I  am  permitted  to  act  as  agricultural  editor  of  a 
daily  journal.  For  a  short  time  I  was  connected  with  the 
University  of  California,  as  Organizer  of  Farmers'  Institutes. 
My  pecuniary  interests  and  my  sympathies  are  with  the 
farmer. 

Mr.  L.  A.  Clinton,  assistant  agriculturalist  in  the  College  of 

Agriculture  of  Cornell  University,  has  been  kind  enough  to 

prepare  for  me  a  chapter  upon  "The  Study  of  the  Farm,"  from 

a  standpoint  which  I  could  not  take— that  of  a  farmer  and  a 

man  of  science. 

Edward  F.  Adams. 

Wrights,  Californiaf  May,  1899. 


CONTENTS, 


PAGE 

Introductory 7 

Book  First.    The  Larger  Aspects  of  Farm  Life. 

CHAPTER 

I.  The  Old  Farmer 11 

II.  The  New  Farmer 15 

III.  The  Evolution  of  the  Farmer 18 

IV.  The  Hope  of  the  Farmer 22 

Book  Second.    The  Farmer's  Education. 

I.     The  Scientific  Farmer 28 

II.     The  Agricultural  Collecie 39 

III.  The  Experiment  Stations 46 

IV.  Special  Schools  of  Farming 51 

V.     The  Farmer's  Institute 55 

VI.  Agriculture  in  Common  Schools 60 

VII.  Agricultural  Papers  and  Books 69 

VIII.  The  Study  of  the  Farm 76 

IX.  A  Further  Study  of  the  Farm  (L.  A.  Clinton)  .    .  82 

Book  Third.    The  Farmer's  Relationships 

I.     The  Farmer  and  His  Family 89 

II.     The  Farmer  and  His  Fellows 96 

III.  The  Farmer  and  His  Competitors 100 

IV.  The  Farmer  and  His  Creditors 106 

V.     The  Farmer  and  the  Politicians 118 

VI.     The  Discontent  of  the  Farmer 120 

Book  Fourth.    The  Farmer  as  a  Business  Man. 

I.  Tin?  Farmer  and  the  Banker 130 

II.  The  Farmer  and  the  Commission  Merchant      .    .    .152 

III.  The  Farmer  and  the  Railroads 158 

IV.  The  Farmer  and  the  Speculator 176 

V.  The  Farmer  and  the  Tradesman 182 

VI.  The  Farmer  and  the  Tax  Gatherer 187 

Book  Fifth.    The  Farmer  as  a  Cooperator. 

I.  Principles   of    Cooperation 202 

II.  Some  Fundamental  Rules  of   Cooperation  ....  209 

III.  Co  )perative  Corporations 218 

IV.  Essentials  of  Security  in  Cooperative  Societies  .    .  229 
V.  Elements  OF  Danger  IN  Cooperative  Societies  .    .    .234 

VI.  Management  of  Cooperative  SociETiiis 240 

VII.  Economic  Gain  of  Cooperation 257 

VIII.  Altruism  in  Cooperation 279 

IX.  Organizations  of  Farmers 284 

(V) 


VI  CONTENTS. 

Book  Sixth.    The  Fanner  and  Questions  of  the  Day. 

CHAPTER  PAGE 

I.  The  Farmer  and  the  Tariff 294 

II.  The  Farmer  and  Export  Bounties 31  o 

III.  The  Farmer  and  the  Single  Tax 324 

IV.  The  Farmer  and  the  Currency 342 

V.  The  Farmer  and  the  Labor  Question 384 

VI.     The  Farmer  and  the  Trusts 39() 

VII.     The  Farmer  and  the    Referendum 413 

VIII.     The  Farmer  and  Socialism 422 


Book  Seventh.    The  Cooperative  Fruit  Marketing  Societies  of 
California. 

I.  Their  Character  and  Objects 434 

II.  Conditions  Leading  to  Their  Organization  ....  442 

III.  The  California  Fruit  Union 452 

IV,  The  California  Raisin  Association 458 

V.  The  Dried  Fruit  and   Nut  Associations 470 

VI.     The  California  Fruit  Exchange    ........  489 

VII.     The  Citrus  Exchanges .  505 

VIII.     The  Wine-Makers'    Corporation 517 


APPENDIX 


A.  Morrill  &  Hatch  Acts 533 

B»  Curriculum  of  Dairy  Schools  and  Short  Aijricultural 

Courses •    •    •  '^"^^ 

C.   New    York    Agricultural    Education    Extension  Law 

and  Helps  to  Teachers 553 

r     I.     How    TO    Get    United   States   and   State    Docu- 

D,j  mp:nts 5(51 

(  II.     A  Few  Books  of  Interest  to  Farmers    ....  5G() 

C     I.     Statistics  Relating  to  Banks 576 

E,  ^        CI.  Decisions  of  U.  S.  Interstate  Com.  Commissions  580 

(ll.  ^    2.  Extracts  FROM  Report  OF  Inters' E  Com.  Com's  598 

3.  Statistics  of  Railroads  in  United  States  .    .  599 


F, 


I.     Cooperation  among  Farmers 602 

II.     Cooperation  among  Others  Than  Farmers  .    .    .  605 

^   I     I.     Statlstics   Relating  to  Curhehcy    QuiiiTiONS  .    .  610 

I    11.     List  of  Trusts 648 

Indkx 651 


INTRODUCTORY 


THE  present  volume  is,  so  far  as  I  know,  the  first  attempt 
to  present  any  comprehensive  review  of  the  farmer's 
position  and  relations  as  a  business  man.  I  am  quite 
sure  that  it  is  the  first  to  pursue  those  relations  to  their 
ultimate  foundations,  group  them  together,  and  place  them 
in  popular  form  for  convenient  examination,  disentangled, 
so  far  as  they  can  be,  from  the  affairs  of  other  classes.  The 
book  is,  in  fact,  an  elementary  treatise  in  applied  economics, 
in  which  the  farmer's  interests  are  employed  as  a  constant 
standard  of  comparison.  The  facts  and  principles  set  forth 
are,  of  course,  entirely  famiHar  to  economists,  and,  to  a  great 
degree,  to  the  different  classes  of  business  men,  as  to  the 
points  where  their  interests  directly  impinge  on  those  of 
the  farmer.  The  farmer,  for  the  most  part,  has  not  had  his 
attention  called  to  these  matters,  and,  so  far  as  he  has  con- 
sidered them,  has  been  prone  to  rely  too  much  upon  a  partisan 
press,  and  the  utterances  of  political  and  other  orators,  who 
seek  to  accomplish  some  present  end  by  exciting  and  increas- 
ing his  prejudices.  As  a  result,  the  farmer  is  continually  at 
a  disadvantage  in  his  pecuniary  dealings  with  those  better 
informed  than  he  as  to  the  trend  of  commercial  movements. 
The  only  remedy  for  the  farmer  is  a  study  of  fundamental 
principles,  in  the  light  of  which  he  may  correctly  read  the 
meaning  of  current  events.  This  book  is  intended  as  an  aid 
to  such  study.  By  our  own  intellects  we  must  form  our 
own  judgments,  but  we  all  need  the  aid  of  the  experience 
of  others. 

While  nothing  in  this  book  will  be  new  to  economists, 
and  very  little  to  experienced  business  men,  I  am  quite  sure 
that  much  will  seem  strange  to  many  in  the  classes  for  which 

(7) 


INTRODUCTORY. 


the  book  is  intended,  and  especially  to  some  farmers.  A  study 
of  the  business  relations  of  the  farmer  takes  us  far  from  the 
farm.  The  farmer's  interests  are  intertwined  with  all  other 
interests.  ,  The  great  social  and  commercial  movements  of 
tlie  day:aTe  matter?  oi^dollars  and  cents  to  the  farmer.  All 
political  q<uest.iQiis- are  money  questions,  and  can  not  be  omitted 
from  aiiy- book' wKioli'pu'i^ports  to  deal  adequately  with  the 
farmer's  business  interests. 

The  farmers  constitute  the  one  class  which  is  essential  to  the 
existence  of  the  race.  Without  the  farmer  we  should  perish. 
Whatever  concerns  him  concerns  all  mankind,  and  whatever 
affects  other  classes  reacts  upon  him,  and  this  not  merely  in 
an  esoteric  sense,  but  in  the  dollars  and  cents  which  he  takes 
in  and  pays  out.  What  occurs  on  and  about  the  farm  the 
farmer  can  see,  understand,  and  in  some  measure  control. 
What  occurs  elsewhere,  however  profoundly  it  may  affect  him, 
he  may  never  even  hear  of,  and  can  hardly  influence  at  all. 
It  is  essential  that  the  farmer  know  more  than  he  does  of 
these  distant  forces,  because  it  is  necessary  that  he  adjust  him- 
self to  conditions  which  he  can  not  control.  The  farmer,  for 
example,  can  not  control  the  operations  of  railroad  magnates, 
the  machinations  of  speculators  on  grain  exchanges,  the  rate 
of  discount  at  the  Bank  of  England,  or  the  standard  of  life  of  the 
Indian  ryot,  but  all  these  help  to  determine  the  price  he  shall 
receive  for  his  wheat,  and  what  he  shall  pay  for  the  supplies 
he  needs.  The  intent  of  this  book  is  to  set  him  thinking 
more  about  such  things. 

It  is  hoped,  also,  that  it  may  be  equally  useful  to  others 
than  farmers.  Relations  are  reciprocal.  It  is  as  important  to 
the  tradesman  or  the  artisan  to  thoughtfully  consider  wherein 
the  interests  of  the  farmer  coincide  with  or  differ  from  his 
own,  as  it  is  for  the  farmer  to  understand  his  position.  Besides, 
whatever  affects  the  farmer  equally  affects  other  classes, 
although  possibly  in  different  ways,  and  while  in  this  book 
the  welfare  of  the  farmer  is  the  standard  by  which  interests 
are  judged,  yet  all  interests  may  be  fairly  well  judged  by  any 
fixed  standard— and  it  will  be  astonishing  to  many  to  dis- 
cover how  closely  the  true  interests  of  us  all  are  united. 


INTRODUCTORY.  v 

I  suppose  some  of  my  readers  will  disagree  with  me  in 
many  things;  possibly  this  may  be  because  they  will  not 
understand  me.  A  strong  English  author*  has  said,  in  sub- 
stance, tliat  the  most  difficult  of  intellectual  feats  is  for  one 
man  to  precisely  understand  another  in  anything.  But  when 
good  men  differ  it  is  never  upon  questions  of  logic,  but  always 
upon  questions  of  fact.  One  believes  one  thing  and  reasons 
upon  it,  while  the  other  thinks  some  other  thing  to  be  true 
and  reasons  accordingly.  When  two  men  agree  upon  the 
facts  in  the  major  and  minor  premises,  the  conclusions 
which  they  reach  will  be  identical.  The  way  to  settle 
differences,  therefore,  is  to  ascertain  the  facts  and  let  the 
argument  take  care  of  itself.  But  if,  after  all,  there  should 
remain  differences  of  opinion,  I  may  say  to  my  non-agreeing 
friends  that  for  myself  I  learn  ver}^  little  from  those  who 
think  exactly  as  I  do,  while  I  learn  a  great  deal  from  those 
who  think  otherwise.  Possibly  they  may  have  the  same 
experience.  At  any  rate,  this  book  is  not  written  to  prove 
anything  whatever,  but  to  render  such  aid  as  it  may  to  those 
who  wish  to  find  economic  truth  wherever, it  is. 


^Ruskin — "Sesame  and  Lilies. 


BOOK  FIRST. 

The  Larger  Aspects  of  Farm  Life. 


CHAPTER    I.      .•  :  .  .      :  ; 

THE    OLD    FARMER  * 

THE  old  farmer  was  a  jack  of  all  trades.  T  rememoer 
that  ill  the  then  new  country  of  Northeastern  Ohio  each 
farmer  sought  to  raise  two  or  three  acres  of  wheat,  of 
which  he  took  what  he  needed  to  the  neighboring  mill,  pay- 
ing toll  for  the  grinding  at  the  rate,  if  I  remember  rightly,  of 
two  quarts  to  the  bushel,  and  taking  home  his  flour,  middlings, 
and  bran.  His  surplus  wheat  he  sold  usually  in  my  time  at 
$1.00  a  bushel.  He  had  from  five  to  ten  acres  of  corn,  which 
he  mostly  fed  out  on  the  place  to  hogs,  of  which,  after  filling 
his  pork  barrels,  he  would  have  one  or  two  to  turn  off.  A 
steer  or  "  farrow  cow,"  also  fattened  on  the  corn,  was  usually 
killed  in  the  fall,  half  sold  among  the  neighbors  and  half 
corned  or  dried  for  family  use,  incidentally  furnishing  the 
tallow  for  the  dipped  candles.      From  three  to  a  dozen  sheep 

*  This  chapter  first  appeared  over  my  signature  in  the  San  Francisco  Call, 
in  September,  1895.  It  was  an  expansion  of  a  portion  of  a  lecture  by  Prof. 
E.  A.  Ross,  of  Stanford  University,  to  which  I  had  listened  a  few  weeks 
previous.  Due  credit  was  given  to  Dr.  Ross  in  this  original  publication.  The 
article  was  somewhat  widely  copied  in  the  press  of  the  day,  and  subsequently  I 
saw  similar  articles— some  by  well-known  authors— which  were  also  widely 
copied.  The  contrast  between  the  old  and  the  new  conditions  is  very  obvious, 
and  the  subject  is  evidently  fascinating  to  those  of  us  whose  boyhood  memories 
run  back  to  those  days.  Portions  of  three  chapters  immediately  following  also 
appeared  in  the  series  of  which  this  chapter  formed  a  part.  k.  f.  a. 

(11) 


12  THE    LARGER   ASPECTS   OF    FARM    LIFE. 

supplied  the  wool,  which  was  taken  to  the  "carding-machine" 
and   made  into  "rolls,"  paying  for  the  work  with  a  certain 
number  of  pounds  of  wool.     Before  my  time  the  women  of  the 
house  used  to  do  this  work  with  hand-cards,  and  I  have  seen 
this  done,  but  generally  in  my  boyhood  women  had  emanci- 
pated themselves  from  this  work ;  but  they  spun  the  yarn  and 
knit  the  stockings,  and  in  most  houses  was  a  loom  constructed 
by  the  men,  whereon  every  year  was  woven  by  the  women  one 
or  two  pieces  of  stout  woolen  cloth  to  be  made  up,  in   the 
house,  into  garments  for  both  sexes.      The  bad-smelling  dye 
pots  sat  about  the  fire  all   winter.      Every  year  or  two  an 
&.cro  of  fiax  was  i-aised,  which  the  men  "broke"  and"hetch- 
eled,"  and  the  women  spun  and  wove  and  made  up  into  cloth- 
ing.    The  hide  of  the  beef  killed  for  family  consumption,  with 
those  of  a  calf  or  two  killed  during  the  year,  were  taken  to  the 
tannery,  and  after  six  months  brought  home  and  made  up 
into  boots  and  shoes,  sometimes  by  the  men  of  the  house,  but 
more  often  by  the  neighboring  or  traveling  shoemaker.      A 
half  acre  of  potatoes  and  a  good  garden  supplied  the  vegeta- 
bles for  the  year.     A  few  cows  furnished  a  surplus  of  butter, 
which,  with  the  eggs  not  consumed  on  the  farm,  was  traded  at 
the  store  for  the  calicoes,  white  shirting,  an  occasional  ribbon, 
and  the  necessary  crockery  and  small  groceries.     The  orchard 
supplied   the  fruit,  cider,  and  vinegar.       The  "sugar   bush" 
furnished   the   maple  sugar,  which  was'  sometimes  used  for 
sweetening,  but  more   usually   traded   for  "muscovado,"   or 
brown   sugar.     The   elder  males  of  the.  family  had  Sunday 
suits  of  store  cloth  made  up  by  the  village  tailor;   this  was 
before  the  days  of  "ready  made;"  these  suits,  after  some  years' 
wear,  were  turned  and  made  up  by  the  women  for  the  boys, 
and  were  worn  out  by  them,  one  after  another,  as  they  grew 
into  them.     The  elder  women  had  each  a  sober,  dark  dress  for 
Sundays,  but  the  girls  mostly  went  to  church  in  fresh  calico, 
and    very  trim   indeed   they   looked   as   I   remember  them. 
Corsets  and  similar  feminine  gimcracks  wore   unknown — at 
least  to  me;  but  it  is  likely  the  town  girls  luid  them,  and  if 
ihey  did  our  girls  knew  all  about  them.     Bonnets  and  hats 
were  worn,  with  an  occasicial  change  of  ribbon,  until  they 


THE    OLD    FARMER.  13 

wore  out.  A  cast-iron  plow,  with  the  necessary  hoes,  rakes, 
and  scythes,  constituted  the  "boughten"  farm  machinery. 
The  grain  was  threshed  with  a  hand-flail  an  tlie  barn  floor  in 
the  winter,  while  the  women  spun  and  wove  in  tlie  house. 
Many  continued  this  practise  long  after  threshing-machines 
came  in. 

The  boys  got  their  spending  money  by  picking  up  nuts  in 
the  woods  and  from  the  sale  of  the  fur  of  an  occasional  mink 
or  muskrat.  Our  social  gatherings  were  husking  bees  and 
house-raisings  for  the  men,  quilting  parties  for  the  women, 
and  apple- paring  bees,  and,  above  all  things,  the  winter 
singing-school,  for  the  young  men  and  women.  The  centers 
of  influence  were  the  churches,  of  which  two  or  three  denomi- 
nations— not  too  sure  of  each  other's  full  hold  upon  salvation 
— were  always  represented,  the  ministers  receiving  from  $200 
to  $300  per  year,  partly  in  money  and  partly  in  provisions, 
with  the  necessary  wood  and  an  annual  donation  party.  The 
reading  matter  was  the  New  York  WeeJdy  Tribune  (I  do  not 
remember  what  standard  paper  the  Democrats  took;  there 
were  very  few  Democrats  where  I  lived),  Godeifs  Ladies'  Book, 
the  New  York  Ledger  in  families  of  doubtful  piety,  the  Phreno- 
logical Journal  by  those  of  advanced  thought,  the  religious 
paper  of  the  denomination,  and  the  county  paper.  Each 
family  had  a  few  books,  which  were  exchanged  until  all  had 
read  them,  and  there  was  always  the  Bible,  the  Sunday-school 
library,  and  Dick's  or  Josephus'  works,  to  fall  back  on.  The 
education  was  in  the  district  school. 

The  above  outline  comprises  or  suggests  the  essential 
features  of  the  life  of  the  thrifty  100-acre  farmer  on  the 
Western  Reserve  in  Ohio  fifty  years  ago.  Further  east  there 
was  a  little  more  ready  money  and  luxuries;  further  west 
there  was  less,  and  more  dependence  on  wild  game  for  meat 
and  for  furs  to  get  money  with.  The  great  prairies  had 
hardly  been  touched.  Transportation  was  slow  and  expensive, 
and  the  products  of  each  district  were  mostly  consumed 
therein,  the  small  surplus  which  accumulated  painfully 
finding  its  w^ay  to  the  seaboard  in  exchange  for  such  necessa- 
ries as  we  could  not  ourselves  produce.    The  farmer's  interest 


14  THE    LARGER   ASPECTS   OF    FARM    LIFE. 

in  markets  outside  his  general  vicinity  was  very  small; 
his  average  trade  with  the  outside  world  would  not  probably 
exceed  $50  or  $75  a  year.  He  received  very  little  money,  and 
kept  it  almost  no  time  at  all;  his  currency  was  the  notes  of 
banks  that  he  knew  nothing  about  and  smooth  Mexican  silver 
that  would  not  circulate  elsewhere.  The  young  man  got  his 
"start"  by  being  permitted  to  raise  a  pair  of  steers  or  a  colt  or 
two  on  the  family  farm,  and  by  working  out  at  odd  jobs.  If 
by  the  time  he  was  twenty-five  he  had  saved  a  couple  of 
hundred  dollars,  or  his  fatlier  could  help  him  make  up  that 
sum,  he  would  buy  a  piece  of  timber  land,  cut  the  logs  for  his 
house,  which  the  neighbors  would  help  him  raise,  marry,  and 
start  to  follow  his  father's  footsteps.  He  would  have  a  sheep 
or  two  from  the  farm,  his  wife  would  bring  a  feather  bed  and 
bedding,  a  cow,  and  such  crockery  as  could  be  gotten  hold  of, 
and  a  new  family  was  founded.  This  was  the  lot  of  the 
thrifty.  The  unthrifty  married  earlier,  got  hold  of  some  kind 
of  a  house,  worked  out  for  a  living,  multiplied  rapidly,  and 
died  off.  But  for  the  most  part  they  were  thrifty  after  a 
fashion  and  prospered.  The  land  was  new  and  abundant, 
with  plenty  more  "out  West,"  and  the  people  had  all  the 
knowledge  required  to  put  it  to  the  best  economic  use  possible 
at  the  time.  They  were,  therefore,  in  the  main  well  nour- 
ished, sturdy,  free  from  worry,  and  therefore  happy.  The 
farmer  of  those  days  was  a  producer  and  manufacturer,  with 
the  knowledge  requisite  for  conducting  his  business,  and  a 
standard  of  comfort  which  his  business  would  maintain.  He 
was  the  independent  man. 


CHAPTER   ]J. 

THE    NEW    FARMER. 

THE  new  farmer  is  primarily  a  business  man.  He  is 
assumed  to  know  how  to  make  crops  grow,  and  usually 
he  does.  The  main  question  is  whether  he  knows  how 
to  produce  crops  which  will  sell  for  more  than  they  have  cost- 
If  he  can  not  in  the  long  run  do  this,  his  inevitable  destiny 
is  to  become  the  servant  of  some  one  who  knows  how  to  direct 
his  labor  to  profitable  results.  Below  this  lies  the  problem  as 
to  whether  the  majority  of  men  possess  the  business  ability 
requisite  to  successful  farming  under  modern  conditions,  and 
upon  the  answer  to  this  question  depends  the  future  of  our 
rural  civilization.  If  it  be  decided  in  the  affirmative,  the 
race  of  independent  small  farmers  will  continue;  if  in  the 
negative,  farm  labor  will  come  to  be  exploited  by  able  men 
conducting  huge  agricultural  operations,  just  as  mechanical 
labor  is  now  exploited  by  Captains  of  Industr3\ 

In  this  age  no  such  life  as  is  described  in  Chapter  I  is 
possible  to  the  farmer  in  America,  nor,  with  our  changed 
habits  and  desires,  would  it  be  agreeable.  It  would  involve 
a  distinct  lowering  of  our  present  standard  of  comfort,  which, 
with  all  our  complaint,  is  far  higher  than  formerly,  and  would 
not  result  in  the  same  content  and  consequent  survival  which 
the  same  conditions  formerly  induced.  The  impossibility  of 
the  life  will  be  seen  by  any  farmer  wdio  will  trace  out  what 
would  happen  should  he  attempt  it.  Doubtless  the  farmer 
could  produce  more  for  his  own  consumption  than  he  does, 
but,  in  the  main,  under  the  changed  conditions  of  modern  life, 
he  is  compelled  to  sell,  for  money,  most  of  his  products,  and 
buy,  for  money,  most  that  he  consumes.  The  mechanical 
facilities  of  modern  times  have  enormously  reduced  the  cost 
of  production,  and  improved  transportation  lias  made  every 
farmer  of  the  civihzed  world  the  competitor  of  every  other 

(15) 


16  THE    LAEGER    ASPECTS    OF    FARM    LIFE. 

farmer  in  the  sale  of  products  consumed  at  his  own  door,  and 
he  who  can  produce  cheapest  will  survive.  The  farmer,  there- 
fore, must  have  the  best  machinery,  and  make  it  available  over 
the  largest  possible  area,  and  this,  again,  restricts  the  small 
farmer  at  least  to  the  production  of  the  specialty  best  adapted 
to  his  location.  There  is  another  reason  for  this;  formerly, 
when  his  surplus  product  was  consumed  near  by,  he  could 
know  the  capacity  of  his  market,  and  the  competition  to  be 
expected;  now,  when  his  surplus  is  often  consumed  many 
thousands  of  miles  away,  and  sold  at  the  price  fixed  by  the 
competition  of  the  world,  it  is  very  difficult  for  any  farmer  to 
inform  himself  of  the  probable  profit  of  production  of  many 
articles.  And  yet  this  knowledge,  while  far  more  difficult 
than  formerly  for  the  farmer  to  obtain,  is  far  more  essential, 
because,  while  formerly  the  farmer  was  interested  in  the 
money  value  of  but  a  small  jiortion  of  his  product,  he  is  now 
interested  in  the  money  value  of  nearly  all  of  it. 

Still  other  elements  now  have  to  be  considered  by  the 
farmer.  The  increased  use  of  money  involves  borrowing  and 
debt.  With  proper  business  knowledge,  borrowing  is  legitimate 
and  profitable  to  the  borrower;  nearly  all  business  men  are  large 
borrowers ;  but  borrowing  in  excess  of  the  knowledge  to  use 
wisely  involves  risk,  paid  for  by  high  interest,  and  often  leads 
to  disaster.  The  farmer,  unaware  of  his  ignorance,  has  become 
greatly  indebted,  and  is  now  profoundly  interested  in  a  stable 
currency.  From  being  a  very  small  buyer  he  has  become  a 
very  large  one,  and  is  vitally  interested  in  the  control  of  trusts 
and  other  combinations  affecting  the  price  of  the  necessities 
of  life.  As  all  that  he  sells  and  all  that  he  buys  are  necessarily 
transported  over  the  great  routes  of  commerce,  he  has  come  to 
have  a  money  interest  in  the  conduct  and  control  of  transpor- 
tation companies.  Paying  more  taxes  than  he  did,  the  farmer 
is  more  interested  in  the  maintenance  of  a  just  system  of  tax- 
ation, and  the  economical  conduct  of  all  public  affairs.  All 
these  and  kindred  subjects  form  part  of  the  great  science  of 
economics,  as  to  which  it  is  highly  necessary  that  the  farmer 
be  well  informed,  in  order,  in  the  conduct  of  his  business,  and 
by  his  vote  when  necessary,  to  intelligently  protect  his  own 


THE    NEW    FARMER.  17 

interests.  From  the  lack  of  this  knowledge  he  is  continually 
misled  by  agitators,  and  often  by  the  ])artisan  press. 

It  appears,  then,  that  from  being  a  producer  and  manufac- 
turer on  a  small  scale  for  the  home  market,  he  has  become  a 
producer  and  mercliant  on  a  large  scale  for  the  markets  of  the 
world.  While  once  little  knowledge  would  serve  him,  and 
that  mostly  such  as  his  own  observation  could  supply,  it  is 
now  essential  that  he  be  a  broadly-educated  man,  familiar 
with  the  conditions  affecting  his  own  business  in  all  parts  of 
the  world.  Henceforward  the  successful  farmers  will  be  only 
those  so  educated.  If  the  product  of  the  small  farm  will  not 
justify  the  expense  of  this  information — and  it  will  not — there 
remains  but  the  alternative  of  the  combination  of  farmers  to 
secure  it  at  the  common  expense  for  the  benefit  of  all,  or  the 
gradual  absorption  of  the  small  farms  by  the  strongest,  and 
the  extinction  of  the  small  farmer,  who  will  sink  into  the 
condition  of  dependent.  This  process,  of  course,  will  not  be 
sudden,  but  gradual,  as  the  world  always  moves,  beginning 
with  the  weakest. 

This  conclusion  is  not  to  my  liking,  but  I  know  it  to  be 
the  opinion  of  such  business  men  as  I  have  heard  express 
themselves,  and  I  believe  it  to  be  the  teaching  of  science  and 
the  judgment  of  all  competent  to  form  one. 


CHAPTER    III. 

THE    EVOLUTION    OF    THE    FARMER. 

IF,  as  the  result  of  some  natural  cause,  the  mean  annual 
temperature  of  the  United  States  should  be  reduced  ten 
degrees  within  the  space  of  a  few  years,  it  is  evident  that 
many  plants  which  now  flourish  in  that  region  would  find  it 
impossible  to  survive.  Others  would  struggle  on  in  the  effort 
to  live,  and  among  these  the  hardier  individuals  would  pull 
through.  They  w^ould  not,  however,  have  altogether  the  same 
character  that  was  before  typical  of  the  species,  but  would  be 
more  or  less  changed.  The  natural  conditions  would  no  longer 
suffice  to  produce  a  product  identical  with  the  former,  but  the 
organs  of  the  plant  would  be  made  use  of  to  produce  something 
more  or  less  similar.  The  place  of  those  species  whose  entire 
organism  was  destroyed  would  be  filled  by  new  species  cal- 
culated to  thrive  under  the  new  conditions.  Between  those 
plants  which  died  outright  and  those  which  promptly  adapted 
themselves  to  the  new  environment,  there  would  be  some 
classes  which  would  struggle  hard  and  long,  and  of  which 
some  would  eventually  survive  in  a  modified  form,  while 
others  would  give  up  the  fight  and  perisli. 

This  illustration  is  but  a  supposed  application  of  a  uni- 
versal law  operating  through  all  nature,  animate  and  inani- 
mate. Had  its  bearings  upon  brute  animal  life  been  chosen 
for  the  example,  other  factors  would  have  had  to  be  considered, 
as  the  power  of  locomotion,  the  power  to  choose  food,  and  to 
protect  themselves  in  various  ways,  as  their  instinct  might 
prompt  them.  The  law,  however,  would  operate.  With  still 
greater  limitations,  it  would  also  operate  on  man. 

What  has  been  supposed  as  having  happened  in  the  natural 
world  is  almost  exactly  analogous  to  what  has  actually  hap- 
pened in  the  world  of  affairs.  The  prodigious  activity  of  man 
in  his  conflict  witli  nature  ha-s  caused  changes  of  conditions  to 
(18) 


THE    EVOLUTION    OF    THE    FARMER.  19 

occur  more  rapidly  than  man  has  been  able  to  adapt  himself  to 
them.  Within  the  trifling  space  of  a  half  century  there  have 
been  greater  changes  in  the  conditions  of  life  than  had  before 
occurred  in  any  five  hundred  years  of  the  world's  history. 
With  all  his  marvelous  power  to  adapt  himself  to  natural 
conditions,  man  has  not  been  able  to  modify  Ins  own  nature  as 
rapidly  as  he  lias  modified  his  environment.  The  result  is 
the  distress  which  we  see  in  the  classes  and  the  individuals 
whose  habits  and  impulses  are  most  fixed.  It  is  found  in  all 
ranks  of  society,  but  we  are  now  concerned  with  it  only  as  the 
farmer  is  afl'ected. 

In  com[)aring  the  classes  of  men  with  respect  to  their 
material  jirosperity,  it  is  convenient  to  divide  them  roughly 
into  capitalists  and  non-capitalists.  By  the  former  I  mean  at 
this  time  all  wlio  live  by  the  application  of  their  labor  to 
property  owned  or  controlled  by  themselves,  as  opposed  to 
those  who  live  by  the  sale  of  their  labor  only.  Under  this 
classification  tlie  farmer  would,  of  course,  be  placed  in  the 
capitalistic  class.  The  farmer  is  at  a  disadvantage  in  his 
material  conditions  as  compared  with  other  property-owning 
classes,  because  he  knows  less  about  his  business  than  they 
know  about  theirs.  This  was  not  always  the  case,  his  relative 
retrogression  being  due  to  the  fact  that  in  his  isolated  life  he. 
has  not  been  so  well  able  as  others  to  keep  pace  with  modern 
progress.  The  tendency  and  inevitable  result  of  this  condi- 
tion is  to  deprive  farmers,  beginning  with  the  weakest,  of  their 
property,  and  reduce  them  to  the  condition  of  dependents;  and 
nothing  can  change  that  tendency  or  prevent  that  consumma- 
tion except  the  general  diffusion  among  farmers  of  such 
business  education  as  will  prevent  them  from  engaging  in 
unprofitable  enterprises.  The  annual  cost  of  the  information 
necessary  for  the  profitable  conduct  of  a  farm  under  modern 
conditions,  however,  is  more  than  the  revenue  from  the  farm  will 
pay  after  supporting  its  owner  in  reasonable  comfort;  and  the 
alternative  confronting  the  small  farmer  is  combination  with  his 
fellows  for  educational  and  other  purposes,  or  gradual  extinction. 

In  order  to  make  this  clear,  let  us  consider  for  a  moment 
what  must  befall  the  farmer  if  he  does  not  educate  himself; 


120  THE    LARGER    ASPECTS    OF    FARM    LIFE. 

and  we  must  remember  that  nature  is  relentless  and  remorse- 
less; the  quality  of  mercy  is  unknown  to  her;  she  does  not 
consider  abuses  but  conditions,  and,  whether  weakness  is 
occasioned  by  misfortune  or  perverseness,  the  penalty  is  the 
same,  and  is  death.  To  fully  understand  this  we  must  leave 
farm  life  for  a  little  and  see  what  the  evolutionists  say. 
Evolutionists  are  mostly  professors,  a  breed  which  some  of  us 
farmers  do  not  esteem  very  highly,  often  referring  to  them  as 
"fellows  with  a  lot  of  theories,"  using  the  term  in  the  con- 
temptuous sense  of  vague  speculations  with  no  basis  save  in 
the  mind  of  the  speculator.  This,  again,  is  because  we  do  not 
know  that  the  science  of  modern  days  is  built  upon  facts 
ascertained  and  verified  with  a  patience  and  precision  of 
which  we  farmers  have  very  little  conception.  The  scientific 
man  does  not,  as  we  sometimes  vainly  imagine,  spend  his  days 
and  nights  in  rapt  but  dreamy  contemplation  of  the  infinite, 
but,  on  the  contrary,  is  mostl}^  concerned  with  minute  detail; 
he  dissects  pollywogs,  and  extracts  the  bones  from  dead  and 
bad-smelling  fish,  which  he  patiently  compares  with  the  pet- 
rified relics  and  imprints  of  those  that  died  years  ago.  This 
he  does,  not  because  he  likes  to  clean  fish  or  break  rock, 
but  because  he  seeks  to  learn  what  has  been  the  rule  of  life  in 
all  ages,  inferring  therefrom  what  now  the  rule  is  and  what 
it  shall  be.  The  collection  of  actual  facts — verified  by  men 
trained  to  observe,  upon  which  modern  science  now  rests,  is 
amazing,  and  daily  the  store  is  increased.  After  some  lives 
have  been  spent  in  gathering  and  classifying  facts  in  a  certain 
line,  the  mass  begins  to  take  shape,  so  that  some  law  running 
through  it  can  apparently  be  discerned;  and  with  that  law 
assumed  to  be  true,  more  lives  are  spent  in  patiently  collecting 
other  facts  and  comparing  them  with  the  assumed  law;  if  all 
facts  as  verified  harmonize  with  the  working  hypothesis,  the 
law  is  strengthened  and  gradually  tends  to  become  part  of 
settled  science;  but  if  one  undoubted  essential  fact  be  discov- 
ered inconsistent  with  that  law,  the  whole  edifice  of  reasoning 
is  destroyed  and  tlio  work  of  robuilding  must  be  patiently 
begun.  Hence  science  must,  above  all  things,  be  sure  of  its 
facts,  and  so  endeavors  to  be. 

The  facts  thus  collected,  verified,  classified,  and  analyzed 


THE    EVOLUTION    OF    THE    FARMER.  21 

through  all  time  until  now  show  that  all  life  has  one  law,  and 
this  law,  at  first  merely  assumed,  by  long-continued  observa- 
tions is  now  considered  settled  and  part  of  science — one  of  the 
tilings  which  we  know  as  well  as  we  can  know  anything  in 
this  world;  it  is  a  law  that  has  so  far  run  through  all  time, 
operates  now,  and,  so  far  as  can  be  seen  or  judged,  will  always 
operate;  it  applies  alike  to  the  birds  of  the  air,  the  trees  of  the 
forest,  the  floating  microbes  about,  and  to  man  himself;  it  is 
universal,  unchanging. 

This  law  is  that  the  only  condition  under  which  any 
species  can  maintain  itself  is  by  the  introduction  of  a  greater 
number  of  individuals  than  existing  conditions  will  sustain — 
the  survival  of  the  fittest,  and  the  death  of  the  unfit.  Could 
this  process  be  checked,  the  species  would  degenerate,  because 
individuals  of  all  species  greatly  differ  in  the  qualities  to 
secure  sustenance  from  their  environment;  and  were  all  to 
propagate  and  transmit  their  qualities  alike,  the  total  result  of 
vigor  would  be  less  than  if  only  the  strongest  survived  and 
left  descendants;  and  it  is  necessary  that  the  aggregate  vigor 
shall  constantly  increase  in  order  to  cope  with  increasing 
difficulties  caused  by  the  increasing  pressure  of  population. 

The  operation  of  this  law  upon  man,  as  distinguished  from 
other  forms  of  life,  is  modified  by  the  fact  that  man  has 
reason.  As  his  numbers  press  upon  the  means  of  subsistence, 
he  is  able,  of  his  own  volition,  to  add  to  those  means.  The 
races  which  have  least  of  this  quality  die.  It  is  evident  that 
the  present  population  of  America  could  not  live  without 
better  means  of  obtaining  subsistence  than  the  red  Indians 
had,  or  have  been  able  to  acquire.  The  time  will  come  when 
existing  populations  will  not  be  able  to  subsist  without  better 
means  than  we  now  have. 

If  all  tins  be  true  it  follows  that  the  weaker  farmers  will  be 
unable  to  sustain  themselves;  the  weaker  farmers  will  be  those 
who  direct  their  labor  least  wisely;  these  again  will  be  those 
who  know  least.  It  is,  therefore,  a  logical  necessity  that  those 
farmers  who  expect  to  live  as  such  shall  adapt  themselves  to 
their  changed  environment  by  acquiring  the  information 
necessary  to  enable  them  to  sustain  themselves  under  their 
changed  conditions. 


CHAPTER    IV. 

THE    HOPE    OF    THE    FARMER. 

THE  present  generation  has  the  means  to  produce  com- 
fortable subsistence  for  all.  I  do  not  know  that  this 
is  or  can  be  scientifically  settled,  but  I  think  no  one 
disputes  it,  and  I  shall  assume  it.  This  subsistence,  however, 
is  very  unequally  distributed.  Looking  into  this  further,  we 
see  that  in  the  long  run  those  who  know  most  have  most; 
those  who  know  most  about  matters  which  directly  concern 
their  own  income  have  most  money,  accumulating  a  surplus 
which  they  can  not  use;  those  who  know  most  about  things 
which  affect  the  incomes  of  mankind  generally,  have  most 
honor,  usually  in  addition  assuring  themselves  of  comfortable 
subsistence.  Knowledge  which  affects  nobody's  income  is 
worthless,  and  is  not  sought. 

It  is  best  to  make  clear  this  money  value  of  knowledge. 
Of  course  all  I  can  say  may  be  admitted  in  advance,  and  yet 
those  who  admit  it  may  not  after  all  know  it,  because  real 
knowledge  inevitably  influences  action.  We  do  not  touch  a 
red-hot  stove,  because  we  know  it  will  burn  us.  If  in  that 
sense  we  knew  the  danger  of  ignorance,  which  is  just  as  real, 
we  should  strive  for  knowledge  at  any  cost.  The  only  real 
knowledge  is  that  which  we  habitually  and  unconsciously  act 
upon.  Any  so-called  knowledge  wdiich  comes  short  of  that  is 
mere  vague  impression,  unavailable  for  practical  use.  Now. 
although  it  can  not  be  actually  demonstrated,  I  am  sure  that 
the  incomes  of  those  engaged  in  any  business  vary  almost  in 
a  direct  ratio  with  the  number  of  essential  facts  pertaining  to 
that  business  which  they  know  accurately  and  certainly.  Of 
course  it  is  true  that  individuals  greatly  vary  in  cai)acity  and 
vigor,  but  then  it  is  the  smart  and  strong  who  know.  All  that 
the  weaker  and  less  capable  can  do  to  maintain  equality  is  t( 
study  more  hours,  to  toil  more  nights  and  days.     It  is  knowl- 

(22) 


THE    HOPE    OF    THE    PARMER.  23 

edge  that  brings  the  income.  Farmers  are  apt  to  denounce 
the  great  salaries  paid  in  some  walks  of  life,  but  they  are 
nearly  always  the  price  paid  for  knowledge,  or  supposed 
knowledge,  at  market  rates.  The  farmer  who  prefers  the 
life  of  a  banker  lias  merely  to  know  better  than  any  one  else 
what  property  is  safest  to  lend  money  on,  and  to  make  his 
ability  known;  some  bank  will  soon  want  him.  Farmers  are 
large  borrowers,  and  as  they  are  apt  to  seek  loans  w^hich  they 
have  not  the  knowledge  to  use  wisely,  the  bank  president 
must  be  a  better  judge  of  the  possible  profits  of  farming  than 
the  farmer  himself,  lest  the  bank's  funds  be  invested  where 
they  can  not  be  got  back  when  wanted.  This  means  a  high 
salary  for  the  bank  officer,  which  goes  to  reduce  the  profit  of 
the  farmer;  for  ignorance  must  pay  its  own  bills.  If  farmers 
could  know  enough  about  their  own  business  to  make  loans 
to  them  certain  to  be  so  wisely  used  as  to  pay  interest 
promptly  and  the  principal  at  maturity,  a  less  expensive 
man  could  lend  them  money,  and  the  farmer's  profits  be  so 
much  increased. 

I  have  said  that  the  most  capable  know  most,  and  conse- 
quently get  most.  Fortunately  it  is  not  necessary  for  us  all  to 
know  as  much  as  the  most  capable.  Nature  requires  that  w^e 
know  enough  to  get  a  living,  and  kills  us  if  we  do  not;  but 
she  does  not  concern  herself  with  great  accumulations.  If  w^e 
are  strong  enough  and  know  enough  to  make  such  accumu- 
lations, she  does  not  mind  it,  and,  if  necessary,  will  kill  off 
such  weaker  ones  as  may  stand  in  our  way;  but  if  we  attempt 
to  accumulate  beyond  our  strength,  she  will  kill  us  for  that, 
too.  All  she  requires  is  that  we  be  warmed  and  well  nour- 
ished, and  our  minds  kept  free  from  worry,  but  for  the  lack 
of  those,  whether  with  or  wnthout  our  own  fault,  no  excuse 
will  be  taken. 

Since  evolution  teaches  that  the  penalty  of  ignorance  is 
death,  it  is  well  to  understand  just  what  the  evolutionist  means 
by  death;  we  may  be  dying,  and  not  know  it.  Evidently  the 
evolutionist  does  not  mean  that  the  ignorant  shall  fall  down 
in  their  tracks  and  give  up  the  ghost,  or  even  that  within 
a  short  time  they  shall  all  disappear  and  leave  no  sign.     He 


24  THE   LARGER   ASPECTS   OF    FARM   LIFE. 

means  simply  this:  that  by  reason  of  our  ignorance  we  shall 
be  unfortunate;  being  unfortunate,  we  shall  be  worried;  being 
worried,  we  shall  not  be  well  nourished;  not  being  well  nour- 
ished, we  shall  die  before  our  time,  leaving  half-nourished  and 
nervous  descendants  to  live  still  shorter  lives,  until  our  names 
finally  perish  from  the  earth.  That  is  what  death  means  to 
the  evolutionist,  and  it  is  the  process  which  the  ignorant  are 
now  going  through. 

We  are,  then,  atoms  in  a  struggling  mass  of  humanity,  of 
whom  it  is  certain  that  the  weakest  must  die,  but  amid  wdiich 
it  is  the  highest  duty  of  each  one  of  us  to  make  sure  that  he 
shall  live.  If  we  can  also  aid  others  to  live,  we  shall  do  well, 
but  nature  does  not  demand  it  of  us,  nor  can  we  do  so  until 
we  have  first  satisfied  our  own  debt  to  the  awful  force  which 
controls  us;  but  by  as  much  as  we  maintain  or  increase  our 
own  vigor,  by  so  much  we  add  to  the  aggregate  vigor  of  our 
race.  It  is,  therefore,  not  only  essential,  but  morally  right 
that,  up  to  a  certain  point,  we  look  out  for  ourselves;  and  we 
are  compelled  not  only  to  live,  but  to  live  up  to  a  certain 
standard  of  comfort  which  is  customary  among  those  with 
whom  we  mingle.  The  Chinaman  lives  in  happiness  and 
holds  his  own  among  the  races  amid  environments  which 
would  be  death  to  the  American  farmer. 

I  have  now  to  disentangle  from  this  seething  multitude  the 
farming  class,  and  especially  the  American  farmer,  in  order  to 
note  his  condition  as  compared  with  others  of  his  race,  and 
see  whether  or  not  he  is  holding  his  own,  and,  if  not,  whether 
of  his  own  volition  he  can  strengthen  himself,  recover  any 
ground  he  may  have  lost,  and  maintain  his  position  among 
those  who  shall  live;  and,  as  I  am  now  considering  mankind 
solely  with  reference  to  the  relative  power  of  survival,  I  am 
compelled,  as  already  stated,  to  again  make  the  rather  heart- 
less division  into  owners  and  non-owners  of  property,  meaning 
by  the  latter  class  those  who,  in  the  prime  of  life,  have  not  in 
their  possession  the  means  of  supporting  tiiemselves  without 
serious  worry  during  their  years  of  decline.  For  the  acquisi- 
tion of  the  means  of  subsistence  according  to  one's  station  in 
life  is  not   only  the  best,  but  the  only  evidence  of  power  of 


THE   HOrE   OF   THE   FARMER.  25 

survival.  Tliose  who  can  not  do  that  may  be  of  the  salt  of 
the  earth,  but  they  are  delivered  over  to  the  bondage  of  death. 
The  farmer,  from  the  nature  of  his  business,  must  be,  or  ought 
to  be,  a  property  holder,  and  I  wish  here  to  compare  him  only 
with  other  owners  of  property.  In  past  years  the  American 
farmer  has  been  regarded  as  the  type  of  an  assured  prosperity 
within  a  very  moderate  range,  and  his  occupation  considered 
as,  upon  the  whole,  the  safest  to  engage  in  by  those  who  were 
prepared  to  be  content  with  abundant  nourishment,  warm 
housing,  and  moderate  intellectual  and  social  enjoyment,  with 
freedom  from  serious  care.  It  has  been  thouglit  that,  upon 
the  whole,  those  who  contended  for  the  more  brilliant  prizes 
of  life,  even  if  they  achieved  them,  paid  more  for  them  than 
they  were  worth ;  much  more  the  majority,  who  strove  for 
them  and  yet  failed.  It  has  been  believed  that  the  strain  and 
worry  of  the  severer  strife  so  seriously  impaired  their  power 
of  survival  as  to  far  more  than  counterbalance  any  comforts 
or  enjojauents  which  they  were  able  to  secure.  If,  now,  com- 
paring the  farmer  of  to-day  with  the  farmer  of  half  a  century 
since,  we  find  that  estimate  still  holding  good,  the  farmer  is 
still  holding  his  own,  and  need  not  be  discouraged.  If,  on  the 
contrary,  we  find  habitual  worry,  care,  and  dependence  grad- 
ually taking  the  place  of  the  independence,  comfort,  and 
security  which  he  formerly  enjoyed,  then  he  is  losing  ground, 
and  must  bestir  himself.  I  do  not  propose  to  enter  U[)on  a 
detailed  comparison  of  the  condition  of  the  farmer  as  com- 
pared with  other  property-owning  classes.  Each  of  my  older 
readers  is  as  competent  as  I  to  compare  for  himself;  I  simply 
record  my  own  judgment,  which  is  that  the  farmer  has  ceased 
to  be  the  independent  man  whom  I  knew  in  my  boyhood. 
He  is  attacked  by  the  care  and  worry  of  the  business  man, 
without  the  business  man's  equipment  to  meet  them,  and  he 
is  losing  ground.  If  I  am  wrong,  I  am  glad  of  it,  but  I  shall 
proceed  upon  that  assumption. 

Now  this  decadence  of  prosperity,  in  my  belief,  is  entireh-- 
unnecessary.  The  farm  is  the  storehouse  of  vigor,  without 
which  and  the  application  it  makes  possible  tliere  can  be  no 
knowledge,  or  the  prosperity  which  knowledge  brings;  from 


26  THE    LARGER    ASPECTS    OF    FARM    LIFE. 

the  farm  the  ranks  of  the  prosperous  are  being  constantly 
recruited;  tlie  drift  of  our  best  into  the  cities  is  notorious; 
farm  boys  make  the  best  records  in  school  and  in  college. 
Their  mother  earth  has  given  them  the  vigor  which  is  the 
foundation  and  the  means  of  all  progress.  We  have,  then,  as 
farmers,  the  basis  of  success  in  the  physical  strength  which 
makes  success  possible,  and  yet  we  are  falling  beliind  in  the 
race.     We  have  the  earth,  and  are  frittering  it  away. 

It  would  be  worse  than  useless  to  write  in  this  strain  if  our 
condition  was  such  as  to  admit  of  no  remedy.  If  we  are 
doomed,  it  is  better  not  to  know  it;  but  if  we  are  merely  in 
danger,  he  who  points  it  out  is  indeed  a  benefactor.  Certainly 
the  position  of  agriculture  is  not  in  danger;  those  who  control 
the  sources  of  sustenance  may  laugh  at  all  Others.  But  the 
question  is.  Who  shall  control  them?  It  is  the  hope  of  man- 
kind that  they  shall  continue  to  be  controlled  by  the  class  of 
small  farmers  who  have  tlius  far  been  the  producers,  and  not 
be  delivered  over,  like  the  other  classes  of  mankind,  to  be 
exploited  by  Captains  of  Industry;  nor  do  I  believe  this  a 
vain  hope.  But  it  is  certainly  worth  while,  if  possible,  to 
discover  and  set  forth  the  causes  why  the  farmer  of  to-day  is 
less  happy  than  the  farmer  of  former  days,  that  w^e  may  see 
how,  if  in  any  way,  those  causes  may  be  removed,  and  the 
farmer  be  enabled  to  regain  his  earlier  position.  If  we  can 
once  be  made  to  see  plainly  tlie  road  by  whicli  we  passed 
from  prosperity  to  misfortune,  we  may  find  it  such  that  we 
can  retrace  our  steps  upon  it.  We  may  be  sure  of  one  thing, 
— that  if  the  American  farmer  was  ever  prosperous  and 
])appy  it  was  because  at  the  time  he  had  all  the  knowledge 
which  he  needed  <to  maintain  his  power  of  survival.  Wliat 
our  investigation  should  disclose  is  wdiy  he  has  not  now  that 
knowledge,  whether  he  can  regain  it,  and,  if  so,  how. 

What  has  been  said  is,  perhaps,  sufficient  to  indicate  why 
wo  have  fallen  behind  in  the  race,  and  the  opinion  of  the 
present  writer,  at  least,  of  our  power  to  regain  our  position, 
which  lies  in  the  possession  of  physical  strength.  What 
chiefly  concerns  us  is  the  exact  method  by  whicii  this  may 
be  accomplished.     There  can  be  but  one  way.    Wo  must  know 


THE    HOPE    OF    TTTE    FARRIER.  27 

more.  We  are  being  distanced,  not  by  greater  strength,  but 
by  a  wiser  use  of  strength.  Otlier  classes  know  better  tlian 
we  what  it  will  pay  to  do  or  avoid.  This  knowledge  comes 
not  by  vague  speculation,  but  by  the  mastery  of  facts.  We 
farmers  reason  well  enough  upon  what  we  think  to  be  true, 
but  we  are  so  often  mistaken  in  our  facts  that  we  are  as  apt  .to 
be  led  into  doing  unprofitable  things  as  into  attempting  those 
which  are  profitable.  To  ascertain  truth  is  usually  difficult. 
To  act  upon  error  is  the  easiest  of  all  things.  So  we  take  the 
easy  road.  This  we  must  stop.  There  are  signs  that  we  are 
stopping.  In  fact,  those  who  are  in  a  position  to  do  so  already 
see  a  goodly  multitude  leaving  the  broad  road  and  climbing 
the  more  difficult  paths  wliich  really  lead  to  the  summit 
which  we  seek.  This  is  the  Hope  of  the  farmer,  the  prospect 
of  better  things. 


BOOK    SECOND. 

The  Farmer's  Education. 


CHAPTER    I. 

THE    SCIENTIFIC    FARMER. 

IT  is  hard  to  account  for  the  intense  prejudice,  often 
amounting  to  positive  hostilit\%  wliich  many  farmers 
entertain  towards  "scientific  farming."  An  editor  of  a 
long-established  agricultural  journal  once  told  me  that  he 
never  allowed  the  term  "scientific"  to  be  used  in  its  columns 
as  applied  to  any  farming  operations,  knowing,  as  he  did, 
the  intense  dislike  of  many  farmers  for  the  term.  And  as 
the  subscribers  to  agricultural  journals  comprise  the  most 
intelligent  farmers,  we  can  imagine  what  the  prejudice  must 
be  among  the  more  unintelligent  class,  which  reads  no  such 
papers,  and  which  my  friend  did  not,  therefore,  have  in  mind. 

Of  course,  like  all  prejudice,  this  has  its  origin  in  a  mis- 
understanding, since  no  sane  person  would  or  could  object 
to  scientific  farming,  if  he  knew  what  is  meant  by  it.  What 
those  dislike  who  ridicule  scientific  farming  is  what  every- 
body dislikes,  which  is  unfounded  pretensions  to  superior 
knowledge. 

While  engaged  for  a  short  time  in  promoting  Farmers' 
Institutes  for  the  University  of  California,  it  was  my  duty  to 
become  fully  informed  of  the  feeling  of  farmers  in  regard  to 
the  work,  in  order  that  we  might  adapt  our  lectures  and 
discussions  to  the  real  feeling,  and  not  attempt  to  lead  in  any 
way  until  we  had  first  gained  confidence.  It  was,  therefore, 
my  habit  to  ask  two  or  three  of  the  most  interested  to  carefully 

(28) 


THE    SCIENTIFIC    FARMER.  29 

note  what  was  said  of  us  behind  our  backs,  and  let  me  know, 
without  mentioning  names.  The  subjects  discussed  were  the 
usual  ones  of  soil  composition,  the  action  of  water  in  the  soil, 
plant  physiology,  the  physics  of  plant  growth,  and  the  like, 
and,  as  a  special  effort  was  being  made  by  the  College  of 
Agriculture,  care  was  taken  that  each  subject  should  be 
presented  by  specialists.  In  almost  every  instance  the  reports 
made  to  me  showed  that,  while  most  of  those  present  were 
interested,  there  were  always  some  who  were  not,  and  the 
great  majority  of  farmers  did  not  come  near  us  at  all.  The 
usual  remark  made  about  us  by  this  class  of  farmers  was  that 

we  were  a  "  lot  of theorists."     I  indicate  the  adjective 

in  order  to  show  that  the  speakers  were  moved  not  merely  by 
indifference,  but  by  positive  dislike.  They  considered  us  con- 
ceited mischief-makers.  One  of  this  class,  after  listening  for 
a  short  time  to  a  lecture  on  the  treatment  of  faulty  soils  by 
one  of  the  greatest  living  authorities  on  that  subject,  went 
out  and  reported  to  a  congregation  of  his  fellows  on  a  street 
corner  that  "them  fellers  can't  I'arn  me  nothin',''  and  straight- 
way the  party  repaired  to  a  neighboring  grocery,  and  spent 
the  day  playing  pedro.  Of  course  these  were  specially  low- 
minded  men,  probably  incapable  of  improvement,  and  not 
destined  to  survive,  but  there  is  no  doubt  that  more  or  less 
of  this  feeling  exists  in  much  bettor  men,  and  is  the  greatest 
obstacle  to  profitable  farming  by  small  farmers. 

The  word  "theorist,"  by  the  way,  is  a  favorite  expression 
among  this  class  of  persons.  Now  no  sane  person  ever  engages 
in  any  agricultural  operation  except  upon  some  "theory"  of 
his  own.  He  performs  certain  work  upon  the  "theory"  that 
some  particular  result  will  follow.  So  we  are  all  theorists.  If 
our  theory  is  based  upon  accurate  and  complete  knowledge,  it 
is  pretty  sure  to  be  sound;  if  otherwise,  there  is  great  danger 
that  it  may  be  unsound,  and  results  not  desired  follow  our  work. 
In  calling  scientific  farmers  "theorists,"  the  uneducated  man 
means,  so  far  as  he  means  anything,  to  say  that  the  scientific 
man  does  not  know  his  facts,  but  a.ssumes  things  to  be  true 
which  are  not  true,  or  not  all  the  truth.  In  this  assumption  the 
objector  is  guilty  of  the  same  intellectual  crime  of  which  he 


30  THE  farmer's  education. 

accuses  others,  and  is  himself  wholly  mistaken  in  his  premises; 
for  the  men  who  are  now  employed  in  this  work  by  the  great 
universities  do  understand  their  subjects.  The  part  which  the 
farmer  knows  they  assume,  and  do  not  waste  time  in  talking 
about.  "Science"  does  not  bother  itself  with  teaching  a 
farmer  how  to  hold  his  plow,  or  when  to  put  in  his  crop,  or 
the  time  to  harvest,  or  any  other  of  the  mechanical  operations 
of  the  farm.  These  are  learned  on  the  farm  by  practice. 
What  science  does  for  the  farmer  is  to  discover  and  make 
known  to  him  things  which  he  can  not  or  is  not  likely  to 
discover  for  himself,  but  which,  if  he  knows  them,  will  enable 
him  to  apply  his  labor  to  better  profit.  The  foolish  farmer  is 
the  one  who  thinks  he  already  knows  all  that  is  worth  know- 
ing, and  refuses  to  learn  more.  When  he  competes  with  the 
farmer  who  studies,  he  finds  that  his  competitor  is  producing 
more  cheaply  than  he,  and  is  underselling  him,  with  the 
result  that,  sooner  or  later,  he  goes  to  the  wall,  and  his  farm 
passes  to  one  who  knows  how  to  make  better  use  of  it. 

Briefly,  therefore,  the  term  "scientific  farming"  simply 
means  farming  in  the  light  of  all  the  accurate  information 
obtainable  from  experience,  observation,  persons,  or  books. 
It  excludes  farming  on  the  basis  of  inaccurate  or  incomplete 
information.  It  makes  no  difference  where  the  information 
comes  from.  A  veterinary  surgeon  may  never  have  been 
out  of  a  great  city,  and  yet  be  able  to  give  the  farmer 
essential  information.  The  farmer  must  learn  from  the 
entomologist,  the  chemist,  the  physicist,  and  others  who  can 
teach  him  perfectly,  although  they  never  saw  a  plow.  Per 
contra,  the  unscientific  farmer  is  one  who  attempts  to  carry 
on  the  farm  in  the  light  of  the  trifling  amount  of  infor 
mation  which  one  man  can  gather  in  a  lifetime,  and  who 
imagines  that  the  experience  of  able  men  ceases  to  be  valuable 
when  once  it  is  written  down  in  books. 

The  object  of  science  applied  to  agriculture  is  to  reduce 
cost  of  production.  Science  has  cheapened,  and  is  constantly 
cheapening,  all  products  which  the  farmer  has  to  buy.  Until 
lately  it  has  not,  in  America,  been  much  applied  to  agricul- 
ture.     There   are  various   reasons  for  this.      For  one  tiling, 


THE    SCIENTIFIC    FAKMEU.  31 

scientific  knowledge  is  extremely  expensive,  and  in  a  new 
country,  with  insufficient  capital,  there  were  bettor  induce- 
ments for  enterprise  in  other  directions.  It  was  also  the  fact 
that  our  great  areas  of  virgin  soils  enabled  us  to  make  money 
while  employing  wasteful  methods,  just  as  the  earliest  users  of 
the  steam  engine  made  money  by  the  use  of  machinery  whose 
employment  now  would  insure  prompt  bankruptcy  to  the 
user.  Our  competition  while  using  even  these  wasteful 
methods  has  compelled  the  older  European  countries  to  make 
use  of  science  in  reducing  costs  to  a  degree  of  which  we  have 
little  conception.  Now  our  ow^n  virgin  areas  having  all  been 
occupied,  the  owners  of  our  partially-exhausted  soils  are 
brought  into  competition  with  the  farmers  on  virgin  soils  of 
the  tropics  and  the  southern  hemisphere,  and  we  feel  their 
competition  just  as  the  European  farmers  have  long  felt  ours. 
Among  our  own  farmers  some  have  been  quick  to  see  and 
utilize  the  economies  which  science  suggests,  and  are  pro- 
ducing cheaper  than  their  neighbors.  Whenever  produce 
sells  "low"  for  a  considerable  time  that  fact  is  usually  evidence 
that  some  are  employing  cheaper  methods  than  others,  and 
that  their  product  is  supplying  the  market.  Those  who  do 
not  employ  as  good  methods  are  crowded  out.  It  is  in  this 
way  that  nature  kills  off  the  weak. 

It  is  not  necessary  or  usually  possible  that  the  successful 
farmer  should  be  a  scientific  man.  It  requires  a  lifetime  to 
become  a  good  scientist  or  a  good  farmer;  very  few  men  can 
be  both.  What  is  necessary  is  that  the  farmer  shall  make  use 
of  the  discoveries  of  science  to  lessen  costs  of  production,  and 
the  farmer  who  does  this  is  a  scientific  farmer,  no  matter  how 
he  gets  the  necessary  information. 


In  discussing  the  larger  aspects  of  farm  life  we  reached  the 
conclusion  that  the  "Hope  of  the  farmer  is  in  greater  knowl- 
edge." The  literature  of  the  Patrons  of  Husbandry  says  that 
"education  is  the  corner-stone  of  the  Grange."  Without 
some  further  explanation  both  these  expressions  are  mere 
platitudes — meaning  vague  statements  which  no  one  will  dis- 


32  THE    farmer's    EDU(JATrON. 

pute,  but  to  which  no  one  attaches  any  special  significance. 
It  is  proper  at  tliis  point  to  inquire  what  are  some  of  the 
definite  things  which  the  modern  farmer  needs  to  know, 
and  which  constitute  his  "Hope"  of  better  progress  towards 
material   comfort. 

The  mechanical  operations  of  the  farm  are,  of  course,  not 
referred  to,  for  those  the  farmers  already  understand,  although 
those  who  know  most  about  even  them  will  be  the  first  to 
concede  that  they  are  constantly  acquiring  helpful  informa- 
tion as  to  operations  which  they  have  conducted  from  boy- 
hood. No  I'armer  of  fifty  years  of  age  will  concede  tliat  he  has 
not  learned  much  since  he  was  forty,  as  to  management  of 
soils,  methods  of  drainage,  ways  of  combating  pests,  desirable 
varieties  of  crop  plants,  treatment  of  crops  in  harvesting,  the 
feeding  and  breeding  of  stock,  and  the  like,  which,  taken 
togetlier,  constitute  what  we  call  farm  practice.  He  does  know 
more,  and  part  of  his  increased  knowledge  has  been  attained 
by  his  own  experience,  and  part  by  observation  of  the  experi- 
ence of  his  neighbors.  The  ordinary  farm  practice  in  different 
localities  is  very  well  understood  by  those  who  live  in  them, 
and  is  best  learned  on  the  farm  itself,  if,  indeed,  it  be  possible 
to  learn  it  well  elsewhere.  Such  knowledge,  therefore,  is 
assumed  to  be  possessed  by  the  farmer.  So  long  as  he  is  on 
virgin  soils  in  a  growing  country  with  extending  markets,  it 
serves  his  purpose  very  well. 

But  the  modern  farmer  does  not  live  under  such  condi- 
tions. He  lives,  for  the  most  part,  upon  deteriorated  soils  in 
communities  which  seem  lo  have  gotten  their  growth.  Tliere 
are  no  longer  new  settlers  coming  in  to  make  a  home  market 
for  produce.  It  seems  harder,  for  some  reason,  to  get  on. 
The  shiftless  families  whose  children  once  swarmed  in  the 
schoolhouses  have  been  gone  for  years.  Where? — No  one 
knows.  Tliey  are  undergoing  the  process  of  extinction.  Of 
late  years  there  has  been  in  many  neighborhoods  another 
process  going  on.  One  by  one  the  small  farmers  have  been 
"selling  out"  to  the  larger  farmers  adjoining,  and  these  families 
also  have  gone.  Why  did  tliey  sell,  and  where  have  tiiey 
gone?     These  questions  are  not  so  easy  to  answer.     Doubtless 


TllK    SCIENTIFIC    FAliMEK.  33 

in  many  cases  the  reasons  for  selling  were  founded  in  the  gen- 
eral spirit  of  unrest  which  is  an  American  characteristic,  and 
doubtless,  also,  in  many  cases  they  have  bettered  their  condi- 
tion by  so  doing.  In  most  cases,  however,  I  suppose  they 
have  sold  because  they  found  it  yearly  more  difficult  to  live. 
The  pressure  of  competition  was  becoming  too  strong  for  them. 
They  needed  to  know  something  which  their  neighbors  knew, 
or  they  would  not  have  been  able  to  buy.  The  majority  of 
these  families  have  doubtless  started  the  down-hill  road. 
Finally,  of  late  years,  in  the  newer  states  there  are  many  who, 
no  longer  able  to  obtain  good  land  by  merely  settling  on  it, 
have  purchased  at  high  prices,  and  run  in  debt  for  it.  These 
families  are  usually  paying  very  slowly  for  their  land,  if  at 
all.  Interest  is  eating  them  up.  Plainly  there  was  something 
which  these  people  could  have  learned  to  their  advantage. 

First  of  all,  the  farmer  needs  to  know  how  to  reduce  the 
cost  of  his  products.  The  prices  he  can  not  control.  He 
finds  his  margin  of  profit  insufficient.  His  one  resource 
is  to  reduce  costs.  The  farmer  is  now  only  passing  through 
an  experience  which  all  other  industries  have  encountered, 
but  from  which,  until  lately,  the  American  farmer  has  been 
exempt.  The  farmer  knows  that  costs  of  manufactured 
articles  have  decreased,  because  he  buys  them  cheaper. 
When  he  inquires  how  costs  have  been  reduced,  he  will 
find  that  in  every  instance  it  is  the  work  of  scientific  men 
— mainly  engineers  and  chemists.  When  ho  understands 
this,  he  should  at  once  be  prepared  to  expect  aid  from  the 
same  source.  And  he  is  getting  it  from  that  source.  The 
farm-yard  fertilizers  produced  are  wholly  inadequate  to  the 
requirements  of  many  agricultural  industries,  and  commercial 
fertilizers  are  bought  in  enormous  quantities.  All  that  we 
know  as  to  these  we  have  learned  from  the  chemists.  The 
entomologists  and  botanists  have  learned  the  life  histories 
of  injurious  insects  and  fungi,  and  tlie  chemists  have  com- 
pounded the  materials  for  combating  them.  When  the 
farmer  "bluestones"  his  seed  wheat,  he  is  doing  merely  what 
some  chemist  at  some  time  tauglit  some  farmer.  The  mechan- 
ical engineer  fashions  the  modern  farming  ini[)lenients  accord- 
3 


34  THE  farmer's  education. 

ing  to  the  unvarying  laws  of  mathematics.  The  veterinarian 
and  entomologist  have  located  the  cause  of  Texas  fever  in  a 
parasite  which  the  chemist  has  taught  us  how  to  destroy, 
as  he  long  since  taught  us  how  to  eradicate  sheep  scab.  The 
physicist  has  learned  how  soils  are  formed,  has  definitely 
classified  them  according  to  the  size  of  their  particles,  and 
discovered  precisely  how  water  behaves  in  the  different  classes. 
This  aids  the  farmers  who  understand  such  things  to  plant 
and  till  crops  with  better  judgment.  The  meteorologist  has 
<,iscovered  the  laws  of  storms,  and  learned  how  to  gather  data 
by  which  he  makes  the  forecasts  whereby  we  save  our  crops. 
He  is  likely,  within  a  generation  or  two,  to  correctly  foretell 
wet  and  dry  seasons,  and  thereby  guide  us  in  our  planting. 
The  bacteriologist  has  taught  us  innumerable  things,  for 
example,  the  ferments  which  make  or  mar  our  butter  and 
cheese,  and  the  organisms  which  cause  infectious  diseases  of 
live  stock,  and,  in  a  great  measure,  has  put  them  under  our 
control.  The  biologist  has  taught  us  the  laws  of  heredity, 
and  thus  enabled  us  to  work  intelligently  for  the  improvement 
of  our  live  stock.  The  physiologist  has  taught  us  the  laws  of 
digestion,  and  enabled  us  to  stop  wasting  feedstuffs. 

It  is  unnecessary  to  extend  the  catalogue  of  w^hich  the 
above  is  but  the  beginning.  If  we  took  from  the  farmer  the 
knowledge  which  pure  science  gave  him  so  long  ago  that  it 
has  become  part  of  the  inherited  information  of  the  ordinary 
farmer,  he  would  be  lost.  If  we  took  from  the  progressive 
farmer  the  additional  information  wiiich  he  habitually  uses, 
he  would  produce  no  more  cheaply  than  his  more  ignorant 
brother,  who  is  growing  poorer  every  year,  he  knovv^s  not  how. 
When  I  was  seventeen  years  old,  I  went  one  day  to  hire  out 
in  "haying"  to  a  hard-working  farmer  who  was  one  of  the 
best  men  I  ever  knew.  I  found  him  hoeing  corn,  and  faith- 
fully working  every  inch  of  the  soil  between  the  rows.  Many 
of  his  neighbors  had  horse  cultivators,  but  he  said  he  had 
no  faith  in  them.  The  hoe  was  the  only  tool  to  be  relied  on. 
There  were  many  excellent  men  of  his  way  of  thinking  in 
those  days,  just  as  there  are  now  many  who  have  no  faith 
that  science  can  aid  them.     The  horse  tool  saves  money  to  the 


THE    SCIENTIFIC    FARMER.  35 

fanner  by  enabling  him  to  do  more  work,  and  perhaps  better 
work,  for  a  given  sum  of  money,  thus  reducing  cost.  The 
bacteriologist  saves  money  to  the  farmer  in  enabling  him, 
for  example,  to  avoid  raising  swine  to  die  of  hog  cholera,  by 
inoculating  them  with  serum,  upon  the  same  principle  that  he 
protects  his  child  from  smallpox.  The  object  of  all  applied 
science  is  to  reduce  cost  by  reducing  the  labor  of  production, 
or  protecting  the  finished  or  half-completed  product. 

A  portion,  then,  of  the  "knowledge"  which  is  tlie  "Hope" 
of  the  farmer  is  the  acquaintance,  so  far  as  he  can  possibly 
obtain  it,  with  whatever  science  is  from  day  to  day  discovering 
of  that  which  will  reduce  cost  of  production.  Nothing  else 
will  enable  the  farmer  to  compete  with  his  fellows,  and  main- 
tain his  economic  existence.  Thrift  and  industry  are  assumed. 
All  iinderstand  the  necessity  of  those  virtues;  but  industry 
improperly  applied  will  fail  of  its  reward,  and  it  is  only 
knowledge  which  enables  industry  to  be  wisely  directed.  It 
is  essential  that  some  portion  of  the  time  which  the  thrifty 
farmer  now  devotes  to  manual  labor  shall  be  withdrawn  from 
that  and  expended  in  learning  how  to  most  wisely  employ 
that  labor. 

But  all  this  is  only  one  aspect  of  the  case.  While  the  art  of 
production  is  possessed  in  some  degree  by  all  farmers,  very 
little  is  known  by  them  of  the  science  of  marketing,  and  the  art 
of  maintaining  business-like  methods  is  hardly  understood  at 
all.  In  the  matter  of  reducing  costs,  for  example,  very  few 
farmers  know  the  cost  of  anything  which  they  produce.  The 
subject  of  reducing  the  cost  of  a  product  can  only  be  intelli- 
gently approached  upon  the  basis  of  a  record  of  the  details  of 
present  costs.  It  is  not  necessary  to  enlarge  upon  this,  for 
every  farmer  knows  it.  He  does  not  keep  these  records  in 
America,  because  hitherto  he  has  been  able  to  live  without  it. 
A  merchant  who  has  no  competition  within  fifty  miles  need 
not  know  his  cost  very  accurately,  for  his  selling  prices  will 
be  high  enough  to  cover  waste,  but  to  the  merchant  in  a 
busy  town  every  item  of  cost  is  essential  and  is  duly  recorded. 
Increasing  competition  and  deteriorating  soils  make  this 
equally  essential  to  the  modern  farmer. 


ob  THE    FARMERS   EDUCATION. 

But  there  are  other  things  equally  importaut.  At  this 
point,  however,  it  is  necessary  to  draw  the  distinction  between 
the  farmer  producing  for  a  special  market,  like  the  vegetable 
grower  near  a  large  town,  and  one  producing  for  tlie  general 
market,  like  the  wheat  grower  or  the  cotton  planter.  The 
latter  requires  far  wider  knowledge  and  greater  ability.  He 
must  be,  to  succeed,  a  well-informed  business  man.  It  will  be 
well  to  consider  briefly  some  things  which  the  farmer  needs  to 
know  as  a  business  man. 

In  this  category  I  must  place,  as  not  only  first,  but  far 
more  important  than  all  other  business  information,  a  knowl- 
edge of  what  his  competitor  is  doing.  I  was  for  years 
connected  with  manufacturing  interests,  and  the  one  thing 
which  gave  us  more  concern  than  anything  else  was  to  learn 
what  our  competitors  were  doing.  It  is  the  most  important 
thing  for  any  business  man  to  know.  It  is  a  matter  about 
which  most  farmers  never  think.  As  a  matter  of  fact,  he 
can  not  know  very  accurately  w^hat  they  are  doing.  The 
farmer  who  raises  wheat  in  Illinois  can  get  no  more  for  his 
product  than  the  farmer  in  Argentina  will  sell  for.  The  price 
for  both  is  determined  by  the  outcome  of  the  competition 
between  the  wheat  growers  of  all  parts  of  the  world  under 
existing  conditions  of  demand.  But  while  the  Illinois  farmer 
can  not  be  fully  informed  of  the  factors  of  the  cost  of  wheat 
in  Argentina,  he  can  know  a  great  deal  about  them.  He  can, 
if  he  will,  obtain  fairly  accurate  conceptions  of  the  possibilities 
of  wheat  culture,  one  year  with  another,  in  Argentina.  The 
cost  of  wheat  production  in  any  country  will  be  mainly 
controlled  by  the  physical  character  of  the  country  and  the 
standard  of  life  of  its  inhabitants.  Of  course  the  amount  of 
capital  available  is  an  important  factor,  but  capital  is  intelli- 
gent, and  does  not  go  where  conditions  are  not  favorable  for  its 
use.     It  leaves  such  places  to  the  uninformed. 

At  the  head  of  a  farmer's  business  equipment  I  would 
therefore  place  a  good  knowledge  of  physical  geography^ 
including  commercial  routes,  which  were  formerly  determined 
and  will  always  be  greatly  influenced  by  physical  geography. 
This  is  not  yet  fully  recognized  by  the  universities,  whose 


THE   SCIENTIFIC    FARMER. 


37 


Curriculuras  are  usually  arranged  by  those  without  commer- 
cial experience.  I  have  looked  in  vain  through  courses  of 
study  in  agricultural  colleges  for  evidence  of  any  under- 
standing of  the  supreme  importance  of  such  knowledge  to 
the  farmer  producing  for  the  general  market.  The  subject  is 
much  better  understood  by  commercial  men,  who  find  some 
knowledge  of  it  essential.  The  great  organizers  of  industry 
know  a  great  deal  about  it.  None  need  it  so  badly  as  the 
farmer,  who  must  bear  all  the  risks  of  production.  In  due 
time  the  universities  will  understand  its  importance,  and 
begin  to  send  out  men  equipped  to  deal  with  it,  and  with  the 
standard  of  the  lives  of  the  different  peoples. 

In  so  far  as  one  knows  the  cost  of  his  own  products,  those 
of  his  competitors,  and  the  cost  of  the  transportation  which 
each  must  bear,  he  is  fairly  well  equipped  as  a  producer  and 
seller.  He  can  judge  what  it  will  pay  him  to  produce.  The 
largest  farmers  understand  these  things  very  well.  But  there 
is  another  side  to  this  marketing  problem — the  side  of  the 
consumers.  It  is  the  desires  of  consumers  which  create 
demand.  These  desires  may  be  stimulated.  It  is  a  part  of 
the  trade  of  a  good  marketer  to  create  desires  which  do  not 
exist.  A  wise  producer  also  understands  existing  demand 
and  seeks  to  learn  whether  he  can  profitably  fill  it.  If  he 
proposes  to  grow  flax,  for  example,  he  seeks  to  learn  what 
qualities  are  required  in  flax  for  different  uses,  so  as  to  decide 
whether  or  not  his  farm  will  produce  that  kind  of  flax. 

But,  in  addition  to  the  mere  questions  of  marketing,  the 
farmer's  net  income  is  affected  in  hundreds  of  ways,  by  forces 
which  he  can  not  control,  but  may,  if  he  will,  understand. 
Society  itself  is  a  product  of  an  evolution  not  yet  complete. 
Its  development  is  proceeding  according  to  natural  laws,  some 
of  which,  at  any  rate,  we  can  perceive.  The  science  which 
deals  with  those  phenomena  of  society  which  most  directly 
affect  men's  incomes  is  called  "Economics."  It  considers  such 
questions  as  taxation,  banking,  cooperation,  transportation, 
currency,  commerce  in  all  its  forms,  and  kindred  topics,  many 
of  them  the  subject  of  political  action.  The  farmer  needs  to 
understand  these  subjects  as  they  really  are,  not  only  in  order 


38  THE    FARMER  S    EDUCATION. 

that  he  may  think  and  vote  intelligently,  but  that  he  may  not 
wear  his  heart  out  in  struggling  with  imaginary  causes  of 
evil,  or  with  economic  tendencies  which  can  not  be  changed. 
A  great  part  of  the  education  which  is  the  Hope  of  the  farmer 
lies  right  here.  It  is  a  part  that  has  been  too  much  neglected. 
One  agricultural  college  only  that  I  know  of  (Wisconsin), 
recognizes  by  its  course  of  study  that  some  knowledge  of 
economics  is  a  necessary  part  of  a  farmer's  education.  In 
time  more  will  do  so;  meantime  it  is  hoped  that  this  book 
will  be  found  helpful.  It  deals  with  matters  which  the  farmer 
must  understand  if  he  is  to  use  his  faculties  and  his  influence 
to  the  best  advantage  of  himself  and  the  world. 


CHAPTER  11. 

THE  AGRICULTURAL  COLLEGES. 

AS  is  well  known,  the  Agricultural  Colleges  of  the  country 
received  their  first  endowment  by  a  donation  of  lands 
from  the  United  States.*  The  sale  of  these  lands  and 
the  application  of  the  funds  were  left  to  the  states,  some  of 
which  have  conserved  them  and  have  large  endowments, 
while  others  permitted  them  to  be  sold  to  speculators  at  low 
rates,  and  now  suffer  for  their  folly.  In  addition  to  this  endow- 
ment, these  colleges  now  receive  an  annual  money  appropri- 
ation from  tlie  general  government,  whose  expenditure  is  in 
some  degree  supervised  by  national  authorit}^  All  tliese  are 
Colleges  of  Mechanics  as  well  as  of  agriculture,  and  while 
called  "Agricultural"  Colleges,  are  as  much  bound  to  develop 
mechanical  as  agricultural  science.  In  most  states  there  is 
now  a  "State  University."  In  some  states  the  national  endow- 
ment for  the  Agricultural  College  has  been  turned  over  to  the 
State    University,  in   which   case  the   institution   is   usually 

known   as  the  "Agricultural   College  of  University." 

In  other  cases  the  management  has  been  kept  separate,  and 
the  location  made  in  some  other  place  than  the  University 
town.  This  has  frequently  been  determined  simply  by  the 
relative  strength  in  the  Legislature  of  rival  places  seeking  the 
advantage  of  the  school  and  the  trade  it  would  bring.  For 
the  most  part,  the  so-called  "purely  Agricultural"  Colleges  are 
weak  for  the  reason  that  they  have  not  the  means  to  support 
a  sufficient  number  of  instructors,  or  provide  suitable  labora- 
tories and  shops.  To  make  their  money  go  as  far  as  it  will, 
they  are  compelled  to  pay  lower  salaries  than  the  stronger 
colleges,  and  so  are  unable  to  attract  the  strongest  men  or 
retain  such  strong  men  as  they  develop.     Certainly  I  do  not 


*See  Appendix  A  for  Morrill  Acts  and  Hatcli  Act. 

(39) 


40  THE    FARMERS    EDUCATION. 

say  this  of  all  separate  Agricultural  Colleges,  but  this  is  the 
tendency.  An  Agricultural  College  attached  to  a  strong  Uni- 
versity does  not  liave  to  maintain  professors  of  botany,  mathe- 
matics, chemistry,  physics,  languages,  and  the  like,  which  are 
part  of  the  equipment  of  all  great  Universities,  but  can  expend 
all  its  means  in  the  applications  of  those  sciences  to  agriculture. 
Higher  education  is  a  very  costly  thing.  Mechanics  includes 
machinery,  and  can  not  be  taught  without  machinery,  and 
the  maintenance  of  the  necessary  engineering  })lant  is  too 
great  a  strain  upon  the  resources  of  most  of  the  separate 
Agricultural  Colleges.  The  inevitable  result  is  that  many 
students  are  drawn  from  the  colleges  of  their  own  states  to 
the  larger  and  better-equipped  institutions  of  other  states. 
In  most  cases,  whether  the  colleges  are  separate  or  included 
in  the  State  University,  they  receive  aid  from  the  treasury  ol 
the  state.  A  great  University  requires  an  income  of  at  least 
$1,000  per  day,  with  a  tendency  to  increase.  A  first-rate 
Agricultural  College  alone  will  need  at  least  $500  per  day. 
It  is  not  believed  that  any  of  our  strictly  Agricultural  and 
Mechanical  Colleges  have  anything  like  this  income,  but  a 
first-rate  Agricultural  College  can  be  maintained  in  connection 
with  a  great  University  upon  an  income  of  from  $200  to  $300 
per  day. 

The  proper  office  of  the  Agricultural  College  is  not  well 
understood.  The  popular  impression  of  it  is  as  a  place  where 
young  persons  are  educated  to  become  farmers.  This  impres- 
sion is  wholly  erroneous.  Such  was  never  the  intention  of 
an  Agricultural  College,  nor  is  any  such  function  possible  to  it. 
We  can  not  afford  to  spend  years  in  learning  one  trade,  only 
to  forsake  it  and  practise  another.  Nor  is  it  done.  Those  who 
have  been  sent  to  Agricultural  Colleges  with  the  expectation 
of  becoming  farmers  have  almost  invariably  ended  by  being 
something  else.  This  has  led  to  the  common  complaint  that 
Agricultural  Colleges  "educate  tlie  boys  away  from  the  farm." 
Of  course  they  do.     That  is  what  they  are  for.*     The  error  is 

*This  must  not  be  misunderstood.  The  meaning  is  that  a  full  graduate 
from  a  first-class  Agricultural  College  is  equipped  for  something  different  from 
manual  labor— not  "better,"  but  "  different. "  The  farm  worker  is  helped  bj- 
the  "shorter,"  or  "special"  courses.     Sec  chapter  4  of  tliis  book. 


THE    AGRICULTURAL    COLLEGES.  41 

not  in  the  Agricultural  Collegeg  but  in  the  false  popular 
impression  of  their  nature  and  function.  A  rich  man's  son, 
who  may  exi)ect  to  become  the  owner  of  a  large  hmded  estate, 
or  the  poor  man's  son,  wlio  may  hope  for  the  superiutendency 
of  such  a  property,  will  do  well  to  graduate  from  an  Agricul- 
tural College.  As  a  preparation  for  the  life  of  an  ordinary 
farmer,  a  course  at  an  Agricultural  College  is  a  foolish  waste. 
The  reason  is,  as  we  shall  see,  that  nine-tentlis  of  tlie  time  of 
the  student  will  be  expended  in  learning  what  he  will  have 
no  occasion  to  apply,  and  will  soon  forget. 

The  office  of  the  Agricultural  College  is  to  investigate  phe- 
nomena connected  with  ftirm  life  and  the  operations  of  farming, 
and  disseminate  the  information  gathered.  Of  its  graduates, 
the  functions  of  some  must  be  to  continue  original  investi- 
gations, and  others  to  convey  what  is  learned  to  the  people  at 
large.  Occasionally,  as  stated,  they  will  serve  as  managers  of 
large  properties.  For  this,  however,  vigor,  executive  ability, 
and  common  sense  are  essential.  An  individual  possessing 
these  qualities  will  be  made  more  valuable  by  the  education 
to  be  obtained  in  an  Agricultural  College.  But  if  the  knowl- 
edge gained  is  to  be  applied  only  to  an  ordinary  farm,  the 
cost  of  obtaining  it  would  be  as  unwise  an  expenditure  as  the 
purchase  of  a  combined  harvester  by  the  farmer  who  raises 
only  twenty  acres  of  v/heat.  Besides,  eight  years  spent  in 
sedentary  employment  when  a  young  man,  is  almost  sure  to 
cause  a  dislike  for  the  physical  work  of  a  form.  Habits  are 
not  easy  to  change. 

The  graduate  of  an  Agricultural  College  should  be  able  to 
analyze  soils  and  foods.  The  farmer  does  not  need  to  do  this, 
nor  could  he  usually  have  the  laboratory  and  appliances  for 
accurate  work;  neither,  unless  constantly  engaged  in  it,  would 
he  be  able  to  retain  his  skill.  Nowadays,  when  a  farmer 
desires  an  analysis  of  his  soil,  or  of  any  special  food,  he  gets 
it  done  for  nothing,  by  experts,  by  sending  it  to  his  Agricul- 
tural College.  Why  spend  much  money  to  prepare  one's  self 
to  do  poorly  that  which  he  can  get  well  done  for  nothing? 
The  agricultural  graduate  should  be  a  bacteriologist.  That 
is,  he  should  be  familiar  with  known  forms  of  bacteria,  and 


42  THE  farmer's  education. 

be  able  to  investigate,  isolate,  and  propagate  new  forms.  It  is 
never  necessary  for  the  farmer  to  do  this,  nor  would  he  have 
the  appliances  to  do  it,  or  tlie  time  to  devote  to  it.  He  does 
not  even  need  to  know  how  they  look,  for  he  can  never  see 
them  without  an  expensive  microscope,  nor,  if  he  should  see 
them,  would  he  be  able  to  distinguish  one  from  the  other, 
unless  constantly  engaged  in  observing  them.  It  requires  a 
long  time  to  become  a  bacteriologist,  and  constant  practice  to 
retain  the  art.  It  does  not  pay  to  teach  such  a  difficult  thing 
to  one  who  can  never  make  use  of  it.  If  the  farmer  suspects 
the  presence  of  malignant  bacteria  in  a  plant  or. a  product, 
his  Agricultural  College  will  make  the  investigation  for  him. 
Such  accurate  knowledge  of  the  anatomy  and  physiology  of 
plants  and  animals  as  will  enable  one  to  trace  and  remove  the 
causes  of  disease,  is  gained  only  by  dissection  and  microscopic 
examination  of  living  organisms,  or  those  which  have  lived. 
This  art,  also,  could  not  be  practised  by  the  farmer  if  he  knew 
it,  for  lack  of  time,  practice,  and  appliances.  Why,  then,  learn 
it?  Most  of  what  he  needs  to  know,  in  this  and  other  lines, 
has  already  been  discovered  at  great  cost.  It  is  silly  to  spend 
money  to  do  over  what  has  already  been  well  done.  His 
Agricultural  College  and  its  graduates  will  tell  the  farmer 
what  is  now  known  that  concerns  him,  and  will  undertake 
the  investigation  of  all  new  phenomena. 

The  phenomena  of  nature  are  infinite  in  variety,  and  new 
occasions  for  investigation  are  constantly  arising.  Upon  these 
problems  able  men  in  all  civilized  countries  are  engaged,  and 
the  results  of  their  studies  are  embodied  in  the  special  litera- 
ture of  their  own  languages.  To  keep  abreast  of  tliese  discov- 
eries, and  therefore  save  the  cost  of  unnecessary  duplicating 
work  in  investigation,  the  ability  to  read  other  languages 
than  one's  own  is  required.  For  this  reason  some  part  of  the 
time  spent  in  an  Agricultural  College  is,  or  should  be,  devoted 
to  the  acquiring  of  a  reading  knowledge  of  one  or  more  mod- 
ern languages,  usually  the  German  and  French,  which  are 
rich  in  accumulated  information  not  accessible  in  English. 
It  is  seldom  that  any  real  mastery  of  these  languages  is 
attained  by  students,  but  they  do  become  qualified  to  discover 


THE   AGRICULTURAL    COLLEGES.  43 

and  dig  out  what  tliey  need  from  time  to  time  as  they  need  it. 
It  is  evidently  a  waste  of  effort  to  devote  time  and  money  to 
learning  how  to  imperfectly  read  what  one  will  never  see, 
when  it  is  certain  that  the  imperfect  knowledge  acquired  will 
vanish  in  a  year  or  two  without  constant  use. 

The  time  required  to  become  a  graduate  of  a  first-class 
Agricultural  College  is  seven  or  eight  years,  of  which  three  or 
four  are  spent  in  preparatory  work,  and  four  in  the  college. 
The  cost  can  not  well  be  less  than  $300  per  year,  or  $2,400, 
besides  eight  years  of  time.  This  sum,  and  time,  after  deduct- 
ing the  cost  of  a  reasonable  and  well-directed  education  after 
leaving  the  common  schools,  would  go  far  to  buy  and  stock  a 
small  farm.  If  applied  entirely  to  an  education,  it  should  be 
considered  a  capital  sufficient  to  assure  its  possessor  a  means 
of  livelihood  for  his  life  without  the  additional  expense  of 
buying  a  farm. 

It  should  be  plain,  then,  that  the  Agricultural  College  is  an 
essential  factor  in  assuring  agricultural  prosperity,  but  that  its 
graduates  are  not  necessarily  to  be  working  farmers.  I  do  not 
say  that  the  working  farmer  will  not  be  the  better  for  a 
complete  education,  provided  he  will  work  on  his  farm,  but 
after  spending  time  and  money  to  fit  himself  for  other  work, 
he  is  not  likely  to  do  so  and  seldom  does.  A  person,  however, 
who  can  not  or  will  not  work  on  his  farm  ought  never  to  own 
one.  It  is  useless  to  know  how  to  do  things  if  we  do  not  do 
them,  and  if  an  agricultural  education  is  worth  anything,  it 
jQust  qualify  its  possessor  to  do  what  the  uneducated  man  can 
not  do.  The  educated  farmer  who  does  not  work  on  his  farm 
may  have  the  barren  satisfaction  of  knowing  somewhat  more 
definitely  than  others  just  w^here  he  loses  money,  but  this 
knowledge  not  followed  up  is  hardly  worth  the  cost  of  it. 

The  agricultural  graduate  is  a  professional  man,  who  will 
usually,  like  the  doctor,  the  lawyer,  and  the  engineer,  gain  a 
living  by  the  sale  of  his  professional  knowledge.  There  is  no 
more  need,  and  need  be  no  more  intent,  that  the  graduate  in 
agriculture  should  own  a  farm  than  that  a  mechanical  engi- 
neer should  own  a  factory.  He  is  equipped  to  give  professional 
advice,  and,  if  desired,  superintendence.     Until  lately  there 


44  THE   PARMER*S   EDUCATION. 

has  been  almost  no  demand  in  America  for  the  services  of 
agricultural  graduates,  and  their  services  are  never  likely  to 
be  so  well  rewarded  as  those  of  other  professions.  As  a  conse- 
quence, few  students  are  found  to  take  the  full  agricultural 
course,  and  of  such  as  have  done  so  the  majority  luive  drifted 
into  other  occupations.  Nevertheless,  as  the  demand  for 
instruction  in  the  branches  of  science  bearing  upon  agricul- 
ture increases,  the  attendance  at  Agricultural  Colleges  will 
increase.  It  is  increasing  now.  But  most  students  are  poor, 
struggling  painfully  to  acquire  knowledge  and  training  by 
whose  sale  they  can  live.  They  have  little  use  for  education 
wliich  will  not  sell.  General  culture  is  a  beautiful  thing,  but 
it  is  a  luxury,  like  a  greenhouse  or  a  yacht.  A  practical 
education  is  an  education  which  will  sell. 

This,  of  course,  is  the  purely  commercial  view  of  the  sub- 
ject. It  is  the  view,  so  far  as  my  observation  goes,  which  the 
majority  of  university  students  are  compelled  to  take.  In  the 
older  and  richer  communities,  from  which  I  have  been  absent 
for  many  years,  there  are  doubtless  many  who,  having  gradu- 
ated from  an  Agricultural  College,  return  to  the  manual  labor 
of  the  farm.  Whether  they  do  or  not,  however,  they  have 
acquired  true  conceptions  of  the  dignity  of  agricultural  life ; 
of  the  relationship  of  agriculture  to  the  otlier  arts;  of  the 
claims  of  agriculture  upon  the  state  for  material  aid,  and  of 
the  nature  of  the  aid  whicli  should  be  given;  and  they  are 
prepared,  as  well-rounded  and  useful  citizens,  to  become  cen- 
ters of  powerful  influence  in  the  communities  in  which  their 
lot  may  be  cast. 

For  there  is  another  view^  of  higher  education,  far  more 
comforting  and  inspiring  than  the  commercial  aspect  in  which 
I  am  presenting  it,  and  with  which,  altiiough  I  do  not  make 
it  prominent  in  these  pages,  I  can  not  permit  myself  to  be 
thought  unimpressed.  It  is  well  to  be  a  good  farmer;  but  it 
is  far  nobler  to  be  a  good  citizen.  While  from  the  standpoint 
of  the  poor  student  the  mercantile  view  may  of  necessity  be 
almost  overpowering,  yet  from  the  standpoints  of  the  wise 
statesman  who  plans  public  aid  for  higher  education,  the 
strong  teachers  who  rise  to  the  direction  of  its  effort,  or  the 


THE    AGRICULTURAL    COLLEGES.  45 

mature  citizen  who  is  a  lover  of  liis  race,  the  true  end  of 
etkication  is  not  that  tlie  educated  may  be  lioused,  and  clothed, 
and  fed,  but  that  with  a  mind  trained  to  think,  and  a  heart 
inspired  by  daily  contact  with  great  souls,  living  and  dead, 
he  shall  go  fortli  in  tlie  fulness  of  his  youthful  strength,  a 
good  citizen  and  a  noble  man,  to  carry  tlie  light  which  he  has 
received  to  all  who  may  cross  his  path. 


CHAPTER    III. 

THE   EXPERIMENT   STATIONS. 

THE  original  idea  of  the  Agricultural  College  included 
an  experimental  form,  usually  with  the  collateral  idea 
tliat  students  might  earn  part  of  their  support  by  work- 
ing upon  the  farm,  and  that  the  farm  would  be  some  source 
of  income  None  of  these  things  were  found  practical.  In 
the  first  place,  it  is  not  possible  to  endure  the  strain  of  securing 
a  modern  education  and  at  the  same  time  to  do  any  consider- 
able amount  of  physical  labor.  At  least  it  is  possible  only  to 
persons  of  far  more  than  ordinary  strength.  An  old-fashioned 
education  such  as  answered  very  well  a  half  century  since 
could  be  obtained  while  performing  a  good  deal  of  physical 
labor,  provided  the  student  had  ordinary  strength.  So  much, 
however,  is  now  required  to  equip  students  to  compete  with 
others  that  the  strength  of  the  strongest  is  fully  taxed.  In 
fact,  no  good  student  can  begin  to  do  what  he  sees  he  needs  to 
do,  and  it  is  only  a  question  of  what  he  shall  neglect  least 
or  most.  Students  so  engaged  certainly  need  exercise  and 
change,  but  hoeing  potatoes  is  not  found  to  answer  tlie  pur- 
pose It  distinctly  lacks  the  element  of  recreation  which  all 
young  (and  old)  people  desire  and  require,  and,  besides,  the 
potatoes  must  be  hoed  when  they  need  it,  especially  if  there 
is  a  rain  coming  up,  and  the  farm  necessities  were  found 
to  continually  clash  with  the  requirements  of  the  class-room. 
The  work  done  under  such  circumstances  had  no  heart  in  it, 
and  so  was  not  well  done;  a  portion  only  of  the  students 
engaged  in  it,  and  these  could  not  keep  pace  with  the  others 
in  the  classes;  and  the  practice  has  been  abandoned  nearly 
everywhere. 

Besides  the  student  difficulties  there  was  the  trouble  with 
the  instructors  who  were  supposed  to  supervise  the  operations. 
It  was  discovered  that  there  were  first-rate  professors  of  agri- 
cultural science  who  were  horrible  farmers.     An  accomplished 

(46) 


THE    EXPERIMENT   STATIONS.  47 

entomologist  might  not  know  wheat  from  barley  or  a  sulky 
plow  from  a  hay  rake.  He  might  know  all  about  bugs, 
and  have  a  rare  faculty  of  imparting  instruction,  and  so  be 
invaluable  in  the  class-room,  and  yet  be  perfectly  helpless  if 
called  upon  to  deal  with  a  piece  of  boggy  ground.  So  it 
finally  came  to  be  seen  of  all  men  that  few  men  could  be 
good  farmers  and  good  scientists  at  the  same  time — not  even 
agricultural  professors.  A  good  farmer  must  be  a  good  exec- 
utive man,  and  many  good  agricultural  professors  are  not 
such  men,  and  while  there  are  always  attached  to  Agricultural 
Colleges  some  who  are  both  good  instructors  and  good  farmers, 
the  two  arts  can  not  usually  be  practised  by  the  same  man  at 
the  same  time. 

Neither  was  there  any  chance  of  an  income  from  an  experi- 
mental farm.  Experiments  are  costly,  and  the  most  of  them 
fail.  New  plants  are  tried  in  order  to  see  whether  or  not  they 
can  be  cultivated  at  a  profit;  new  methods  of  culture  or  of  feed- 
ing are  tried,  for  the  same  reason.  If  the  plant  or  the  method 
is  not  profitable  it  is  worth  while  to  know  that,  and  it  is  better 
to  have  one  experiment  tried  at  the  public  expense,  and  the 
result  widely  published,  than  for  hundreds  of  individuals  to 
try  the  same  thing,  fail  in  it,  and  say  nothing.  These  things 
are  not  always  well  understood  by  farmers,  and  as  a  farm 
which  continually  tries  things  which  do  not  wx)rk,  is  sure  to 
get  a  bad  name,  the  College  farms,  however  unjustly,  became 
the  subject  of  derision  in  their  communities  to  an  extent 
which  largely  accounts  for  the  general  prejudice  against  Agri- 
cultural Colleges  which  so  long  existed  among  farmers.  It 
was  also  the  fact  that  it  is  not  always  possible,  when  starting 
an  Agricultural  College,  to  secure  the  services  of  a  full  staff  of 
clear-headed,  sensible  men,  with  the  requisite  knowledge  and 
executive  ability.  Political  methods  have  often  controlled 
appointments,  and  there  have  been  some  weak  men  connected 
with  the  colleges,  and  some  foolish  tilings  done,  such  as  could 
hardly  occur  now.     Men  have  found  their  places. 

But  with  the  practical  abandonment  of  actual  farming 
in  connection  with  most  Agricultural  Colleges,  the  necessity 
became  more   urgent  for  actual  experimental  work  for  the 


48  THE  far.mkr's  education. 

public  benefit.  To  meet  this  necessity  the  United  States  Gov- 
ernment appropriates  $15,000  per  annum  to  each  state  to  be 
expended  exclusively  in  experiments  for  the  benefit  of  agri- 
culture. This  sum  is,  I  believe  in  all  cases,  placed  in  the 
hands  of  some  one  connected  with  the  Agricultural  College, 
and  usually  the  head  of  it.  This  person  is  known  as  the 
Director  of  tlie  Experiment  Station,  and  is  held  strictly  account- 
able to  the  United  States  Treasury  for  the  expenditure  of  the 
funds.  He  is  also  obliged  to  publish  at  least  four  bulletins  in 
each  year,  in  which  the  work  done  at  the  station  is  described, 
with  the  results. 

Some  of  the  most  valuable  work  ever  done  in  the  agricul- 
tural interest  has  been  performed  by  these  stations,  and  the 
work  is  likely  to  go  on  forever,  continually  increasing  in 
value  as  more  experience  is  gained.  These  bulletins,  issued 
by  these  stations,  have  come  to  be  the  principal  sources  of 
exact  information  in  agricultural  matters.  Experimenting  is 
an  art,  and  it  is  by  no  means  every  one  who  can  experiment 
in  any  such  way  as  to  secure  valuable  results.  It  is  also  very 
costly,  and  entirely  beyond  the  means  of  the  ordinary  farmer. 

In  a  general  way  all  intelligent  farmers  are  now  familiar 
with  the  work  of  these  stations,  and  yet  their  educational 
value  is  not  well  understood.  Perhaps  their  greatest  value  is 
in  teaching  what  to  avoid.  An  experiment  which  is  successful 
on  a  small  scale  and  with  constant  watchfulness  and  care, 
may  be  wholly  unsuccessful  under  the  ordinary  conditions  of 
farm  life,  but  a  culture  which  will  not  succeed  under  station 
conditions  should  not,  as  a  rule,  be  attempted  under  ordinary 
conditions. 

Experiments  in  feeding  and  digestion  have  been  very 
valuable.  An  animal  can  only  grow  or  yield  work  by  the 
assimilation  of  food.  When  food  was  abundant  and  cheap, 
and  the  market  known,  almost  any  kind  of  feeding  might 
show  a  profit.  But  when  food  is  dear,  or  prices  of  animals 
very  low,  it  becomes  an  object  to  know,  as  exactly  as  possible, 
the  relative  feeding  value  of  all  feedstuffs.  It  is  not  what  an 
animal  eats  but  what  it  digests  that  counts,  and  if  an  increase 
of  muscle  is  desired,  it  is  a  waste  to  feed  fat-forming  foods  in 


THli    EXPERIMENT    STATlOiSS,  49 

excess,  or  if  work  is  desired,  an  excess  of  flesh-forming  foods. 
If  the  weight  of  an  animal  be  talcen,  and  all  it  eats  and  drinks 
for  a  period  be  weighed,  and  at  the  end  of  tiie  period  the 
animal  be  weighed  again,  it  can  be  determined  exactly  how 
much  the  animal  has  assimilated  from  its  food.  If,  then,  the 
food  be  analyzed,  and  also  all  the  excreta  of  the  animal,  it  can 
be  determined  just  how  much  of  the  flesh-forming  and  lieat- 
giving  elements  the  food  contained,  how  much  was  digested, 
and  how  much  voided  unused.  This,  of  course,  will  give  the 
facts  only  for  that  particular  animal  under  the  particular 
conditions  obtaining,  but  in  the  course  of  time  a  large  number 
of  such  experiments  have  been  made  at  diflerent  plnces  and 
with  different  foods  and  animals,  from  all  of  which  an  average 
can  be  had  which  should  show  very  nearly  the  feeding  value 
of  the  food  in  question.  At  this  point  exact  knowledge  stops, 
and  the  result  is  ready  to  be  turned  over  to  the  farmer  to  be 
used  in  the  light  of  his  own  observation  and  common  sense 
with  his  own  stock.  The  result  is  found  to  be  a  large  saving 
in  the  cost  of  feed  per  pound  of  weight  gained,  or  per  horse- 
power of  work  done.  Those  who  employ  these  methods  can 
do  work  or  produce  meat  or  milk  or  wool  cheaper  than  those 
who  do  not  use  them.  In  like  manner  all  farm  operations 
are  experimented  upon  and  tested  by  exact  methods  for  the 
benefit  of  the  farmer.  Forage  and  other  plants  are  tested  for 
their  food  or  other  value,  and  new  plants  as  to  their  adapta- 
bility to  soil  and  climate.  The  effects  of  fertilizers  are  also 
closely  tested  and  different  methods  of  intensive  culture. 

The  experiment  stations  are  among  the  most  valuable  of 
the  educational  agencies  which  the  public  puts  at  tlie  disposal 
of  the  farmer.  Their  means  are  limited,  and  no  station  c;ui 
<lo  all  the  desirable  things  at  once,  but  gradually  an  im- 
mense fund  of  accurate  information  is  being  gathered  by  the 
different  stations  in  this  country  and  Europe,  all  of  which  is 
made  available  to  the  agricultural  world.  Most  stations  send 
their  bulletins  freely  to  all  applicants,  and  all  stations  do  so 
to  applicants  within  their  own  states.  The  farmer,  however, 
must  apply  for  the  bulletins,  and,  to  be  benefited,  must  study 
them  after  he  gets  them,  and  make  usr>  of  their  lessons.  The 
number  who  as  yet  do  this  is  extremely  small  as  compared 
4 


50  THE  farmer's  education. 

with  the  whole  number  of  farmers,  but  is  rapidly  increasing. 
Tliose  farmers  who  live  near  enough  to  their  stations  to  make 
them  an  occasional  visit,  can  benefit  still  more  from  them  if 
they  will  only  ask  questions.  What  they  will  see  there  will 
be  mostly  new  to  them,  for  the  stations  do  not  spend  money  in 
finding  out  what  is  known  already.  A  visitor,  therefore,  who 
merely  passes  through  without  inquiry  is  not  likely  to  learn 
much.  He  will  not  understand  what  he  sees,  and  possibly  will 
imagine  that  the  station  men  are  also  working  in  tlie  dark,  in 
which  he  will  be  wholly  wrong.  I  do  not  think  the  station 
work  is  usually  well  appreciated  by  farmers  living  nearest  the 
stations. 

Akin  to  the  bulletins  of  the  Experiment  Stations  are  the 
publications  of  the  Department  of  Agriculture  at  Washington. 
The  greater  part  of  these  are  prepared  in  a  popular  form  for 
general  use,  and  are  distributed  free  upon  application  to  the 
Secretary  of  Agriculture  at  Washington.  Some,  however,  are 
sold  at  the  cost,  as  fixed  by  the  public  printer,  and  are  obtained 
by  inclosing  the  price  to  the  Superintendent  of  Public  Docu- 
ments at  Washington.  None  of  the  documents  are  sent 
regularly,  as  they  appear,  to  any  address,  except  a  monthly 
list  of  publications,  which  is  mailed  regularly  to  all  who 
request  it  of  the  Secretary  of  Agriculture.  From  this  list  the 
farmer  can  see  what  the  nation  has  published  for  his  benefit, 
and  by  application  can  obtain  what  he  desires. 

These  publications  of  the  Experiment  Stations  and  tlie 
department  are  among  the  most  available  sources  of  informa- 
tion for  farmers.  They  are  su[)plemented  in  many,  and 
perhaps  all  states,  by  the  publications  of  State  Boards  of  Agri- 
culture, Horticulture,  Dairying,  and  similar  official  bodies,  all 
of  which  are  always  mailed  free  to  residents  of  the  state.  It 
is  the  part  of  a  live  modern  farmer  to  know  the  exact  places 
from  which  this  information  is  to  be  had  as  it  aj)pears,  and  to 
apply  for  it  and  make  use  of  it.  Great  sums  of  public  money 
are  spent  yearly  for  the  benefit  of  the  farmers.  The  informa- 
tion supplied  is  authentic  and  useful.  No  other  industry 
receives  any  such  assistance  from  the  public,  and  thus  far  the 
hardest  task  of  all  has  been  to  get  the  mass  of  farmers  to  take 
and  use  the  information  which  is  supplied  to  them  without  price. 


CHAPTER    IV. 

SPECIAL    AGRICULTURAL    SCHOOLS. 

WE  have  seen  that  the  office  of  the  Agricultural  College 
is  to  equip  students  to  deal  with  all  agricultural 
problems.  While  much  practical  information  is 
acquired  and  assimilated,  that  feature  is  necessarily  subordi- 
nated to  the  main  object.  We  have  now  to  note  how  tlie 
power  generated  in  the  college  is  to  be  transmuted  into  work 
on  the  farm. 

The  most  important  of  the  special  schools  of  agriculture 
are  what  are  known  as  "  short  courses "  conducted  at  the 
university  itself.  These  courses  vary  in  length  from  twelve 
weeks  to  two  years.  No  special  preparation  is  required  for 
entrance,  nor  do  they  lead  to  any  degree.  Certificates  of  work 
done  are  often,  and  perhaps  usually,  given  to  attendants,  wlio 
may  use  them  for  what  they  are  w^orth.  The  object  of  these 
short  courses  is  to  convey  to  working  farmers  practical  infor- 
mation wliich  they  can  use  in  their  business.  It  is  not 
attempted  to  equip  students  to  test  the  accuracy  of  the 
information  given  them  or  to  fit  them  to  deal  with  all  con- 
tingencies as  they  arise.  Much  of  what  is  taught  must  be 
accepted  on  trust.  Students  desiring  to  inform  themselves  in 
regard  to  special  branches  of  agriculture  are  given  special 
facilities.  The  students  are  assumed  to  be  mature  enough  to 
know  what  the}^  want,  and  they  are  helped  to  get  it.  For  the 
longer  courses  a  special  line  of  work  is  laid  out,  calculated  to 
meet  the  wants  of  the  majority,  but  up  to  tlie  limit  of  the 
strength  of  the  teaching  force,  individual  work  is  assisted.  If 
one  is  anxious  to  qualify  himself  to  become  a  horticultural 
inspector,  he  may  learn  more  about  insects,  pests,  and  fungous 
diseases  thnn  a  full  graduate  will  know;  if  he  is  or  expects  to 
be  a  grain  farmer,  he  will  learn  about  smuts,  the  Hessian  fly, 
the  characteristics  of  the   different   varieties  of    the    various 

(51) 


52  THE  i-'akmek's  education. 

grains,  as  they  are  grown  throughout  the  world,  the  special 
uses  to  which  each  is  adapted,  their  relative  value  in  the 
market,  and  whatever  else  may  be  found  helpful  to  the  grain 
farmer.  In  the  same  way  desired  special  information  is  given 
in  all  branches  of  the  farming  industry.  In  most  cases  I 
think  that  the  students  in  shorter  courses  are  expected  to 
reduce  by  specific  study  tlieir  general  knowledge  of  the  nature 
and  properties  of  soils  to  some  exactness,  and  especially  to 
learn  definitely  how  water  acts  in  tlie  soil,  and  how  plants  are 
constructed  and  grow,  but  in  general  the  object  of  tlje  shorter 
course  is  to  give  to  the  student  sucli  knowledge  as  he  can  at 
once  put  to  evidently  profitable  use,  as,  for  instance,  the  care 
and  management  of  dairy  machinery,  the  testing  of  milk  aud- 
its manipulation  so  as  to  save  as  nearly  as  possible  all  the 
butter  fat,  the  principles  of  feeding,  and  simple  methods  of 
testing  its  results,  the  nursing  of  sick  animals,  and  the  like. 

To  many  students  perha})S  the  best  thing  which  the  shorter 
courses  gives  him  is  something  which  he  did  not  come  for, 
and  that  is  some  notion  of  the  immensity  of  what  he  does  not 
know.  When  once  a  young  man  has  perfectly  acquired  this 
notion,  he  is  in  a  way  to  get  on,  for  he  is  then  likely  to  begin 
to  learn  from  everything  he  sees. 

The  other  special  schools  directly  connected  with  the 
College  of  Agriculture  are  those  in  which  practical  instruction 
is  given  by  practical  men  to  students  of  special  branches  of 
agriculture.  Of  these  the  dairy  school  is  tiie  most  common, 
and,  indeed,  almost  the  only  one  of  this  class  of  scliools  as  yet 
established.  In  the  dairy  school  it  is  possible  to  reproduce  the 
exact  conditions  of  farm  life.  Tlie  school  dairy  is  exactly  like 
any  other  good  dairy,  and  students  who  themselves  feed  and 
care  for  the  animals  by  what  are  said  to  be  approved  methods, 
can  see  whether  or  not  tliese  methods  actually  produce  tlie 
better  results  which  are  assumed  for  tliem.  Outside  milk  is 
delivered  just  as  it  is  to  other  creameries,  which  the  students 
themselves  can  test,  and  by  reference  to  the  books  can  see 
whether  and  how  well  good  milk  and  good  methods  pay. 
Tiiey  can  learn  to  judge  very  exactly  of  the  value  of  cows  for 
the  dairy.     Tiiey  can  learn  the  most  economical  methods  of 


SPECIAL    AGRICULTURAL    SCHOOLS.  53 

handling  milk  in  the  production  of  butter  and  cheese,  and 
how  to  pro})erly  care  for  macliinery.  They  will  not  learn  much 
about  bacteria,  but  they  will  learn  a  great  deal  about  their 
effects,  and  liow  to  encourage  the  good  and  repress  the  evil  in 
the  process  of  ripening  butter  and  cheese;  and  this  knowledge 
is  all  that  the  practical  dairyman  requires.  Finally,  as  his 
product  is  sold,  he  will  learn,  in  marketing,  exactly  what 
customers  think  of  it. 

His  instructors  in  the  art  will  be  experienced  working 
dairymen,  who  make  their  living  by  that  means,  and  can 
make  it  anywliere.  With  that  instruction  he  will  receive 
regular  lectures  from  the  scientific  staflP,  on  the  principles 
underlying  the  art  which  he  practises,  which  will  put  him  in 
a  way  to  get  the  most  profit  from  his  experience  at  the  school, 
and  subsequently  in  the  dairy  where  he  is  employed.  It  is  by 
the  dairy  school  that  all  the  world-renowned  dairy  districts 
have  attained  their  excellence.  In  these  districts  the  grad- 
uates of  these  schools  are  sought  for  as  workmen  and  superin- 
tendents of  creameries.  For  the  latter  position,  however, 
while  dairy  knowledge  is  essential,  it  is  not  all  that  is 
required.  No  one  can  be  a  good  superintendent  of  anything 
who  does  not  possess,  in  addition  to  accurate  knowledge  of  the 
details  of  the  business,  executive  ability,  vigor,  and  tact.  The 
reward  of  the  dairy  school  graduate  is  not  munificent,  but  it 
is  something.  With  good  bodily  vigor,  it  should  be  $35  per 
month,  or  $50  if  he  boards  himself  The  "butter  maker"  of 
a  large  creamery  should  earn  $900  a  year.  There  are  large 
creameries  which  pay  $100  a  month,  or  even  more,  for  a 
"manager"  or  "superintendent,"  or  whatever  he  may  be 
called;  but,  as  already  stated,  the  requirements  of  these 
positions  call  not  only  for  dairy  knowledge,  but  for  other 
qualifications. 

The  courses  at  these  dairy  schools  greatly  vary.  In  some 
of  the  newer  states  a  single  winter  course  of  three  months  is' 
all  that  is  attempted.  Tlie  Wisconsin  school,  than  which 
there  is  no  better  in  America,  requires  attendance  at  one 
winter  course,  then  a  summer's  practice  in  the  dairy,  then 
another  winter  course,  and  the  final  certificate  is  not  given 


54  THE  farmer's  education. 

except  upon  evidence  of  successful  dairy  practice  for  some 
time  after  leaving  the  scliool.  While  undergoing  probation, 
the  students  are  visited,  wherever  the}^  may  be  at  work  in 
the  state,  by  representatives  of  the  University,  wlio  personally 
satisfy  themselves  of  the  character  of  students'  work  before 
the  certificate  is  granted.* 


*See  Appendix  B  for  curriculum  of  the  Wisconsin  Dairy  School,  which 
typical  of  the  best  class  of  schools  everywhere. 


CHAPTER    V. 

THE    farmers'    institute. 

PERHAPS  the  most  useful,  and,  at  any  rate,  the  most 
widely  useful,  of  the  methods  of  diffusing  agricultural 
education  is  the  Farmers'  Institute.  I  have  not  taken 
pains  to  truce  the  origin  of  this  institution,  but  it  has  grad- 
ually developed,  apparently  from  rather  crude  beginnings,  in 
all  the  progressive  agricultural  nations,  of  course  varying 
in  character  as  well  as  in  name  in  different  countries.  The 
essential  feature  is  the  gathering  of  farmers  at  some  con- 
venient place  near  their  homes,  to  meet  successful  specialists 
in  the  branches  of  agriculture  most  followed  in  the  vicinity, 
for  the  discussion  of  practical  problems  in  agriculture.  Wher- 
ever this  is  done,  by  whatever  name  the  meeting  may  be  called, 
there  is  a  Farmers'  Institute. 

In  their  order  of  relative  importance,  I  conceive  the  objects 
of  the  Farmers'  Institute  to  be,  first,  to  get  farmers  to  thinking 
clearly;  second,  to  get  them  to  talking;  and,  third,  to  convey 
information.  The  latter  is  by  far  the  easiest,  as  the  specialists 
who  conduct  the  institutes  always  have  abundant  information 
to  give,  and  are  accustomed  to  giving  it  to  public  assemblies; 
but  the  mind  untrained  to  such  work  can  receive  and  assimi- 
late but  a  small  amount  of  the  information  conveyed  in  a 
continuous  session  of  a  day  or  two,  and  in  a  few  weeks  there 
will  remain  of  the  information  given,  in  the  minds  of  most 
present,  at  least  so  far  as  it  has  been  given  by  formal  lectures, 
little  more  than  a  vague  impression.  Tiie  best  institute  con- 
ductors fully  understand  this;  and,  instead  of  seeking  to  occupy 
the  time  themselves,  find  the  highest  exercise  of  their  skill  in 
drawing  out  the  experiences  of  the  farmers  present.  This  is 
best,  for  several  reasons.  In  the  first  place,  the  aggregate  of 
useful  experience  in  any  neighborhood  is  always  very  large, 
and,  as  developed  under  local  conditions,  very  apt  to  be  more 

(55) 


56  THE  farmer's  education. 

valuable  than  the  more  general  knowledge  of  the  lecturers. 
At  least  it  has  a  value  of  a  different  kind,  and  is  always  more 
quickly  appreciated  by  those  present.  A  farmer  who  will 
forget  in  a  week  the  greater  part  of  the  good  points  of  a  set 
lecture  from  a  stranger,  will  remember  to  his  dying  day  the 
relation  of  experience  by  a  successful  neighbor.  He  will  also, 
from  time  to  time,  have  opportunity  to  talk  it  over,  and  to 
observe  the  actual  workings  of  the  metliod  advocated.  If, 
encouraged  by  the  relation  of  his  neiglibor,  he  is  led  on  to 
contribute  his  own  experience  on  some  special  point,  great 
good  has  been  done.  If,  as  is  commonly  tlie  case,  there  is 
more  or  less  disagreement,  so  much  the  better.  When  two 
men  disagree,  a  new  center  of  intellectual  activity  has  been 
set  up.  If  the  disagreement  is  of  sufficient  importance  to 
interest  the  community  at  large,  they  are  all  likely  to  engage 
in  investigations  upon  their  own  account,  and  the  influence 
of  the  institute  may  be  felt  in  the  neighborhood  for  years,  and 
far  longer  than  the  effect  of  an  address  of  a  very  able  stranger 
would  have  endured.  When  tlie  disagreements  are  of  slight 
importance,  the  skill  of  the  conductor  is  shown  by  the  meas- 
ure of  his  success  in  diverting  the  discussion  without  offense 
to  any. 

In  this  country  the  Farmers'  Institute  is  a  matter  of  state 
concern,  tlie  Legislatures  of  most  states  making  annual  appro- 
priations for  their  expenses.  This  fund  is,  in  some  cases, 
expended  by  the  State  University,  or  Agricultural  College, 
and  sometimes  by  State  Commissioner  or  Boards  of  Agricul- 
ture. In  most  states  the  majority  of  the  institutes  are  crowded 
into  a  few  winter  months,  when  the  staff  of  the  Agricultural 
College  is  fully  employed  in  college  duties.  In  such  cases- 
the  lecturers  are  mostly  themselves  farmers  who  have  been 
specially  successful  in  some  lines  of  agriculture,  and  who 
are,  besides,  thoroughly  endowed  with  strong  common  sense, 
backed  by  wide  experience.  The  lectures  and  discussions 
at  such  institutes  tend  to  take  on  what  is  called  the  "practical" 
form,  by  which  is  meant  a  relation  of  experience,  or  observa- 
tion and  results,  with  the  underlying  scientific  doctrine  not 
prominent.     The  paid  lecturers,  however,  even  if  not  highly 


THE  farmers'  institute.  57 

educated,  eitlier  are  or  rapidly  become  fairly  well  versed  in 
elementary  agricultural  science,  and  are  able  to  solve  most 
questions  of  that  kind  that  arise. 

On  the  Pacific  Coast,  however,  where  the  institute  season 
extends  over  most  of  the  year,  and  in  most  states  where  the 
system  is  new,  the  conductors  of  institutes  are  usually  of  the 
university  staff,  who  get  away  from  their  college  duties  for  a 
few  days  at  a  time  for  this  work.  At  such  institutes  the 
strong  feature  is  apt  to  be  popular  presentations  of  agricultural 
science,  with  an  effort  thereafter  to  draw  out  the  practical 
experience  of  those  present,  for  comparison  with  the  general 
doctrines  advanced.  At  first  thought  the  latter  form  would 
seem  more  desirable,  and  the  tendency  is  to  regret  that  the 
number  of  university  instructors  must  always  be  too  small 
to  do  any  great  part  of  the  work  whenever  the  demand  calls 
for  a  large  number  of  institutes.  I  am  inclined,  however, 
although  I  have  never  attended  institutes  where  the  university 
work  was  not  the  prominent  feature,  to  believe  that-the  best 
results  are  secured  by  non-professional  instructo"s.  In  the 
first  place,  they  are  pretty  sure  not  to  talk  over  the  heads  of 
their  hearers,  which,  with  all  their  care  not  to  do  so,  university 
professors  are  not  always  able  to  avoid.  The  set  lectures  are 
more  apt  to  deal  with  details  with  which  all  present  are  per- 
sonally familiar,  and,  therefore,  more  readily  draw  out  discus- 
sion from  local  men,  which  after  all  is  the  chief  end  of  the 
institute.  There  is  less  shyness  in  asking  questions  as  to 
detail  of  some  one  who  is  known  as  a  successful  farmer,  than 
in  cross-questioning  a  "i)rofessor"  on  statements  of  general 
principles.  There  is  also  the  general  prejudice  of  farmers 
against "  theorists,"  by  which  they  mean  all  persons  who  do  not 
live  by  manual  labor  on  the  farm,  and  yet  presume  to  discuss 
agricultural  questions;  and  this  prejudice  although  unfounded 
and  irrational,  must  be  taken  into  account  in  estimating 
probable  results.  It  therefore  seems  probable  that  the  best 
results  in  institute  work  will  usually  be  achieved  by  non- 
professional, but  competent,  lecturers  when  those  can  be  had. 
Here,  however,  lies  a  difficulty.  At  the  beginning  they  are 
seldom  to  be  had  at  all.     The  best  farmers  are  apt  to  be  busy 


58  THE    FARMERS    EDUCATION. 

farming.  The  small  pay  that  is  offered  will  not  justify  a  suc- 
cessful farmer  in  leaving  his  business  unless  favored  by  special 
circumstances,  while  it  is  quite  sufficient  to  attract  a  large 
class  who  can  do  no  possible  good,  but  may  very  likely  have 
a  "pull,"  which  the  appointing  power  can  not  always  resist. 
1  am  told  that  there  is  much  trouble  from  this  cause  in  some 
states.  Good  farmers  are,  also,  not  always  good  talkers,  and 
good  talkers  are  not  always  good  teachers,  and  some  who  may 
be  good  farmers,  good  talkers,  and  good  teachers,  are  unable 
to  realize  that  it  is  not  best  for  them  to  talk  all  the  time. 

The  requirements  for  a  successful  non-professional  institute 
worker  are  high  character  and  consequent  good  reputation  at 
home,  infinite  tact  and  good-nature,  sound  common  sense, 
readiness  and  clearness  of  speech,  a  high  order  of  intelligence, 
a  fair  education,  with  readiness  to  learn,  reasonable  success  in 
whatever  he  has  attempted,  and  respect  for  the  opinions  of 
others.  That  is  a  pretty  good  man.  One  can  not  blow  a  horn 
and  collect  a  crowd  of  such  men  about  him.  At  the  begin- 
ning tlie  main  work  must  fall  on  the  staff  of  the  Agricultural 
College,  with  such  help  as  can  be  got  in  the  locality  where  the 
institute  is  held.  In  the  end  the  progress  of  the  work  will 
develop  the  men  who  can  carry  it  on,  just  as  only  a  war  can  • 
develop  the  great  generals. 

Tlie  ideal  two-day  institute  is  doubtless  one  or  two  lectures 
by  college  men,  on  underlying  principles,  with  the  remainder 
of  the  time  occupied  by  local  papers  or  non-professional 
lecturers,  with  a  full  half  of  the  time  devoted  to  brief  and 
pointed  discussion  duly  kept  within  bounds  by  a  tactful  con- 
ductor, and  the  "question  box"  always  going.  The  question 
box  is  a  feature  of  all  good  institutes,  and  affords  an  oppor- 
tunity for  any  one  to  ask  any  question  on  any  agricultural 
topic,  with  a  probability  that  it  will  be  intelligently  answered 
by  some  one.  Stated  times  are  always  set  for  answering 
questions  in  the  box,  as  questions  during  or  following  an 
address  should  always  be  connected  with  the'  question  dis- 
cussed. On  certain  topics — like  veterinary  science,  or  ento- 
mology— the  services  of  a  university  man,  or  a  specialist  of 
some  kind,  are  almost   essential.      When   not   available  the 


THR    FAUMKRS'    INSTITUTE.  69 

second-hand  information  of  the  non-professional  must  be 
made  to  answer.  Non-professional  lecturers,  from  their  fre- 
quent opportunities  to  hear  university  or  other  specialists,  and 
tlieir  own  experience  and  observation,  rapidly  become  able  to 
authoritatively  answer  most  questions  relating  to  common 
pests  and  diseases,  soil  chemistry,  plant  physiology,  and  the 
like;  and  a  successful  and  well-educated  farmer  will  discuss 
feeding  and  culture  problems  with  more  convincing  authority 
than  a  professor. 

This  discussion  of  what  an  institute  and  institute  workers 
should  be  ought  to  give  any  reader  who  is  so  unfortunate  as 
never  to  have  attended  a  Farmers'  Institute,  a  very  good  idea 
of  its  objects  and  methods.  At  the  institute,  so  far  as  possible, 
there  are  taught  the  laws  and  processes  of  animal  and  vegetable 
growth,  the  causes,  nature,  and  prevention  or  proper  treatment 
of  diseases  of  plants  and  animals,  the  mechanical  and  chem- 
ical constitution  of  soils,  the  action  of  water  in  the  soil,  the 
commercial  value  and  proper  culture  of  old  and  new  plants, 
the  science  and  practice  of  feeding,  the  details  of  technical 
dairying  operations,  and  all  the  numberless  major  and  minor 
subjects  bearing  on  rural  life.  Not  that  all  these  things  are 
taught  or  discussed  at  any  one  institute,  but  su(;h  a  selection 
is  made  as  will  best  suit  the  needs  and  desires  of  the  members 
and  the  special  abilities,  knowledge,  and  experience  of  those 
who  lead  and  address  it.  The  institute  is  successful  in  a 
direct  ratio  with  the  spontaneous  questioning  and  discussion 
which  it  elicits.  It  is,  therefore,  what  its  members  make  it. 
I  have  heard  farmers  say  that  they  could  learn  nothing  at 
such  an  institute,  as  they  already  knew  their  business.  Such 
farmers,  if  they  have  the  least  spark  of  humanity  in  their 
bosoms,  should  be  the  first  ones  on  hand  and  the  last  to  leave, 
in  order  that  they  may  communicate  some  of  their  knowledge 
to  the  unfortunate  majority  who  still  have  something  to  learn. 


CHAPTER    VI. 

AGEICULTURE    IN    THE    COMMON    SCHOOLS. 

WITHIN  a  few  years  there  has  been  some  effort  to 
introduce  the  study  of  what  is  termed  "agriculture" 
in  the  common  schools  of  rural  districts.  As  dis- 
cussion has  progressed,  there  has  been  a  tendency  to  substitute 
the  term  "nature  study"  for  "agriculture,"  as  more  definitely 
descriptive  of  what  is  proposed  to  be  taught.  This  term  also 
has  the  advantage  of  being  commonly  employed  by  teachers. 
As  understood  by  them,  however,  it  includes  subjects  not 
directly  pertaining  to  agriculture,  and  has  the  disadvantage  of 
not  conveying  to  the  majority  of  farmers  the  distinct  idea 
of  the  connection  between  the  proposed  work  and  the  art  of 
husbandry.  In  default  of  any  single  English  word  expressing 
precisely  what  we  mean,  I  prefer  for  the  present  to  retain  the 
term  "agriculture,"  meaning  thereby  the  study  of  such  natu- 
ral phenomena,  directly  bearing  upon  farm  work,  as  can  be 
profitably  presented  to  pupils  of  school  age. 

In  this  work,  so  far  as  I  know,  the  authorities  of  the  state 
of  Connecticut  first  took  official  action,  but  the  first  real  prog- 
ress was  made  when,  in  1894,  the  New  York  Legislature,  at 
the  request  of  the  farmers  of  certain  counties  in  the  western 
part  of  the  state,  appropriated  $8,000  to  be  expended  by  the 
Agricultural  Department  of  Cornell  University  in  promoting 
improvements  in  the  practice  of  horticulture  within  those 
counties.  The  terms  of  the  act  permitted  the  promotion  of 
studies  in  aid  of  agriculture  in  the  common  schools,  and  the 
authorities  of  the  University  devoted  part  of  the  appropriation 
to  that  work.  This  work  was  entirely  experimental,  but  it 
could  not  have  been  placed  in  better  hands,  and  the  success 
was  such  that  the  appropriations  for  the  purpose  were  largely 
increased,  and  the  work  extended  to  cover  the  entire  state. 
The  New  York  work   attracted   the   attention   of  the   entire 

(CO) 


AGRICULTURE    IN    THE    COMMON    SCHOOLS.  61 

nation,  and  is  likely  to  ultimately  become  part  of  permanent 
educational  policy  everywhere. 

It  began  in  New  York,  as  it  must  begin  elsewhere,  in 
personal  visits  of  skilled  instructors  from  the  University,  going 
from  one  school  to  another  and  spending  half  days  in  instruc- 
tion. The  teachers  quickly  caught  the  idea  and  were  eager 
to  take  it  up.  To  aid  them  in  this  the  University  printed  a 
series  of  "leaflets"*  containing  sample  lessons  to  be  given 
orally  to  pupils,  and  opened  "correspondence  classes"  with 
teachers,  of  whom  over  ten  thousand  were  enrolled  as  students 
by  1897.  From  this  the  work  has  extended  in  New  York  and 
other  states,  and  will  be  more  or  less  familiar  to  most  of  my 
readers.  No  more  promising  effort  in  aid  of  agriculture  has 
ever  been  made. 

Up  to  the  present  time  the  term  "agriculture"  has  been 
generally  employed  by  the  press  in  discussing  these  new 
studies,  and  it  wiil  probably  hold  its  place.  The  vagueness  of 
this  term,  already  alluded  to,  has  resulted  in  all  sorts  of  mis- 
conceptions as  to  the  nature  of  the  proposed  work,  and  it  is 
desirable  to  inquire  a  little  further  as  to  what  is  really  meant 
by  teaching  "agriculture"  in  common  schools. 

On  the  part  of  farmers  I  fear  that  in  many  cases  nothing 
in  particular  is  meant.  There  is  a  vague  idea  that  in  some 
way  these  common  schools  can  help  to  make  farming  more 
attractive  to  young  people,  as  well  as  more  profitable,  and  thus 
tend  to  stop  the  drift  of  the  young  to  the  cities,  where  most  of 
them  lose  all  chance  of  ever  attaining  an  independent  life. 
Not  knowing  how^  else  to  express  themselves,  they  speak  of 
introducing  "agriculture"  as  a  study,  and  sometimes  of  the 
necessity  of  a  proper  "  text-book  "  for  the  pupils. 

There  is  no  doubt  that  the  common  schools  can  be  very 
helpful  in  this  respect,  and  that  they  are  thus  helping  in  some 
countries.  It  is  not,  however,  nor  can  it  be,  by  the  pursuit  of 
a  formal  "course"  leading  to  definite  attainments  within 
certain  limits,  nor  is  any  "  text-book  "  whatever  required  for 
the  use  of  pupils.     The  first  step  in  any  useful  study  of  agri- 


Soe  Appendix  C  to  this  book,  for  New  York  law  and  speci 


men  leaflets. 


62  THE  farmer's  education. 

culture  in  common  schools  must  be  the  acquirement  of  the 
ability  to  learn  from  nature  direct  with  no  text-book  for  an 
interpreter. 

The  rural  common  school  deals  with  pupils  from  six  to 
fifteen  years  of  age.  What  can  be  done  in  the  way  of  agri- 
cultural teaching  must  be  what  can  be  comprehended  by  pupils 
of  that  age,  and  which  in  practice  can  be  imparted  to  them  in 
the  time  winch  their  own  desires,  and  that  of  their  parents, 
and  public  opinion,  will  permit  to  be  devoted  to  that  purpose, 
in  view  of  the  other  claims  upon  their  time  and  attention.  It 
excludes  the  ordinary  occupations  and  processes  of  the  farm 
which  they  see  going  on  every  day,  and  in  which  more  or  less 
they  take  part.  All  such  things  they  will  and  do  learn  at 
home  to  far  better  advantage  than  in  the  school. 

In  their  earlier  school  days  the  children  are  engaged  in 
accumulating  facts;  later  the  facts  begin  to  unconsciously 
arrange  themselves  in  classes  in  the  mind,  but  they  begin  to 
reason  upon  them  and  formulate  theories  hardly  at  all  during 
the  years  commonly  reckoned  as  of  country  school  age.  If 
compelled  to  undertake  this  process  they  dislike  it,  seldom 
succeed  with  it,  and  the  reasoning  which  the  teacher  ma}'^ 
seem  to  force  upon  them  for  the  time  is  generally  forgotten 
before  the  end  of  the  first  game  of  "I  spy."  If  the  pupils 
seem  for  the  moment  to  comprehend,  and  do,  in  part,  answer 
intelligently,  an  examination  on  the  same  points  a  week  later 
will  prove  that  they  really  never  understood  the  subject.  For 
all  abstract  matters  involving  exercise  of  the  reasoning  power, 
they  must  wait  till  they  are  older.  Childhood  is  the  time  to 
lean]  facts,  and  such  facts  as  really  interest  them  are  never 
forgotten.  This  limitation  of  the  powers  of  childhood  forbids 
any  attempt  to  teach  "  agriculture "  or  any  other  science  in 
any  didactic,  formal  way,  or  presenting  the  subject  by  means 
of  text-books. 

What  they  can  do  is  to  study  nature.  They  can  learn  how- 
plants  grow,  not  by  reading  books,  but  by  planting  and  pulling 
up  plants  and  taking  them  to  pieces  at  various  stages  of  tluir 
growth.  That  is  the  way  "professors"  continue  to  study  plant 
physiology  as  long  as  they  live,  and  it  is  the  only  way  to  really 


A(;kiculturk  i\  the  common  schools.  63 

learn  anything  about  it.  •  Tlie  way  is  as  open  to  children  as  to 
professors,  and  they  take  never-ending  delight  in  it.  A  fair 
microscope  is  within  the  means  of  any  school  district,  and 
with  that  the  cells  and  tissues  of  plants  and  animals  can  be 
seen,  diseased  growths  studied  and  compared  with  healthy 
growth,  insect  pests  can  be  identified,  and  their  life  history 
and  habits  can  be  determined.  Much  of  this  can  be  done, 
and  a  good  foundation  in  systematic  botany  laid,  with  merely 
a  good  common  hand  glass.  The  instinct  for  making  mud 
pies,  with  a  little  ingenuity,  can  be  directed  to  a  practical 
study  of  the  action  of  water  in  the  soil.  The  mechanical 
character  of  soils  can  be  thoroughly  studied,  and  about  every- 
thing learned  that  any  one  can  know.  As  they  get  older,  they 
can  experiment  with  simple  chemical  reactions,  so  as  to  under- 
stand at  least  what  they  are,  and  understand  fairly  well  the 
nature  of  the  chemical  changes  which  take  place  in  the  soil 
and  the  leaf  Such  work  as  this  is  what  is  meant  by  tliose 
who  intelligently  discuss  introducing  the  study  of  "agricul- 
ture" in  tlie  rural  schools.  It  is  good  work  for  any  school. 
It  is  adapted  to  the  mental  nature  of  the  child.  Its  acquire- 
ment is  a  source  of -real  pleasure  to  all  children,  which  is 
certainly  more  than  can  be  said  for  the  elements  of  "gram- 
mar." The  knowledge  thus  gained  will  never  be  forgotten. 
It  is  a  fitting  preparation  for  any  walk  in  life.  It  is  essential 
to  the  making  of  the  farmer  who  hopes  to  survive  in  the 
struggle  for  independent  existence.  It  is  knowledge  which  he 
will  apply  every  day  of  his  life.  The  little  that  he  learns  will 
teach  him  the  methods  of  learning  more  as  special  need  arises 
for  special  knowledge.  It  is  the  best  foundation  possible  on 
which  to  build  up  a  successful  farmer. 

Of  course  the  child  can  not  learn  all  this  by  himself  He 
must,  at  least  at  first,  be  told  where  to  look,  and  possibly  how 
to  look,  and  when  he  sees  a  thing  he  must  be  told  what  it  is. 
And  there  is  the  rub.  The  teachers  know  very  little  more 
about  these  things  than  the  children,  and  the  most  of  them 
have  no  wish  to  learn.  They  have  passed  the  age  of  curiosity, 
and  are  thinking  of  other  things.  If  compelled  to  learn  them 
to  hold  their  places,  they  will  do  so,  and,  very  likely,  for  the 


64  THE  farmer's  education. 

most  part,  get  highly  interested  in  the  end,  and  finally  become 
good  teachers  if  it  is  in  them,  but  nine  out  of  ten  of  them 
will  attack  it  with  regret. 

The  teachers  are  by  no  means  to  blame  for  this.     They 
are  exactly  like  the  rest  of  us,  and  substantially  reflect  public 
sentiment.     Our  ideal  of  education  is  one  of  our  inheritances 
from  England,  and  comes  down  from  a  tinje  when  only  rich 
men's  sons  were  educated,  for  whom  general  literary  culture 
was   the   training   desired,   and   very   likely   most   desirable. 
When   Massachusetts,  and    others  after  her,  established   the 
common-school  system,  the  ideal  of  education  was  the  English 
ideal,    which  was  always  before  that  portion   of  the   public 
which  expected  or  hoped  to  go  beyond  the  three   R's,  and 
directed   the   aspirations  of  teachers   and  parents.     After  the 
Revolution,  and  especially  during  our  periods  of  most  rapid 
expansion,  all  children  were  regarded  as  the  sons  of  sovereigns, 
and  the  ideal  of  their  education  was  that  of  other  princes. 
When  the  pressure  of  population  began  to  be  felt,  there  arose 
a  demand  in  tlie  most  populous  centers  that  some  portion  of 
the  school  time  be  spent  in  direct  training  for  special  avoca- 
tions, and   this   again   raised   the  techiiical   dispute    among 
teachers  as  to  whether  the  pu[)il  is  not  best  prei)ared  for  all 
avocations  by  general  training  without  special  reference  to  any. 
This   educational  question   will  be  settled  by  experiment 
under  demand  created  by  the  increasing  difficulty  of  obtaining 
subsistence  and  maintaining  the  standard  of  comfort.     It  is 
significant   that  the   demand   for  special  instruction  is  now 
beginning  to  be  heard  from  the  rural  districts.     In  most  cases, 
however,  it  does  not  seem  to  come  from  the  masses  of  the 
people,  but  from  a  few  who  feel  that  some  technical  instruc- 
tion is  needed.     The  fact  is  that  for  the  most  part  farmers' 
children  do  not  wish  to  be  farmers,  and  their  parents  sympa- 
thize with  them,  which  results  in  a  feeling  of  apathy  which  it 
is  difficult  to  overcome. 

Another  difficulty  lies  in  the  fact  that  the  teachers  are  not 
farmers,  and  while  many  are  tiie  sons  or  daughters  of  farmers, 
their  feeling  is  not  for  the  farm.  The  outcome  of  all  these 
influences,  new  ideas  struggling  to  get  into  the  schools,  and 


AGRICULTURE    IN    THE    COMMON    SCHOOLS.  65 

old  ones  refusing  to  make  room  for  them,  is  a  very  crowded 
curriculum.  When  anything  new  is  introduced  no  time 
allowance  is  made  for  it,  but  the  teacher  is  expected  to  accom- 
plish just  as  mucli  as  ever  with  everything  else.  Special 
instruction  is  called  for  in  many  things,  which  involves  special 
fitting  on  the  part  of  teachers,  until  they  come  to  wish  to 
avoid  every  new  subject.  In  education,  however,  as  in  every- 
thing else,  there  is  a  competition  of  ideas,  and  the  fittest  will 
survive.  Wherever  the  farmers  in  rural  districts  unite  in 
the  desire  for  such  special  instruction  as  I  have  outlined 
above,  to  be  given  in  the  rural  schools,  they  will  get  it.  They 
can  in  most  cases  get  it  to-day,  without  legislation  or  the  aid 
of  any  one.  There  is  a  keen  competition  among  teachers  to 
get  schools,  and  any  school  in  most  states  whose  officials  let  it 
be  publicly  known  that  they  will  employ  no  teacher  who  does 
not  bring  a  certificate  from  the  State  Agricultural  College,*  of 
competence  to  teach  tlie  elementary  science  underlying  hus- 
bandry, will  get  such  a  teacher  as  is  desired.  Any  consider- 
able demand  of  this  kind  would  at  once  make  the  subject 
prominent  in  all  normal  schools,  and  within  a  short  time 
teachers  will  be  as  competent  to  teach  "agriculture"  as  any- 
thing else. 

It  is  a  fact,  however,  that  such  teaching  as  I  have  outlined 
requires  excellent  ability.  It  is  not  every  one  who  can  do  it 
successfully.  The  teacher  must  have  decided  power  over  a 
subject  to  be  prepared  to  teach  it  orally.  If  a  teacher  has 
learned  to  distinguish  a  cottony  cushion  scale,  and  a  child 
brings  a  specimen  which,  under  the  microscope,  proves  not  to 
be  that  scale,  the  next  question  will  be,  "  What  is  it?"  and  if 
tlie  teacher  can  not  answer,  there  is  a  certain  embarrassment. 
For  this  reason,  and  also  owing  to  the  fact  that  proper  prepa- 
ration for  the  oral  teaching  of  elementary  natural  science  is 
really  beyond  the  reach  of  many  teachers,  systematic  instruc- 
tion in  these  subjects  should  usually  involve  the  employment 
of  special  teachers  who  will  go  from  one  school  to  another. 


*0r  any  university  or  norniul  school  in  wliich  husbandry  and  the  applica- 
tion of  nature  study  thereto  are  properly  recognized  in  the  courses  of  instruc- 
tion. 

5 


08  THE  farmer's  education, 

spending  a  half  day  with  each  in  turn,  the  week  between  eaclj 
visit  being  carried  on  by  the  regular  teachers  by  the  aid  of 
suggestions  contained  in  leaflets  or  hand-books  specially  pre- 
pared for  their  use.  This,  in  fact,  is  the  method  adopted  in 
New  York,  where  Cornell  University  supplies,  at  the  expense 
of  the  state,  competent  traveling  instructors.  This  method  is 
also  employed  in  Germany,  where,  however,  there  is  less  need 
of  it,  as  the  teachers  are  mostly  men  who  make  teaching  the 
avocation  of  their  life.  In  this  country,  where  the  majority  of 
the  teachers  are  women,  many  of  them  quite  immature,  and 
for  the  most  part  with  quite  other  views  for  tlie  future  than 
continuous  teaching,  the  employment  of  special  teachers  will 
probably  usually  be  found  essential. 

The  compensation  for  such  teachers  will  necessarily  be  suf- 
ficient to  justify  the  expense  of  a  suitable  preparation,  and  to 
support  a  man  with  a  family  and  a  horse.  Such  a  teacher 
could  visit  about  ten  schools  a  week,  spending  a  half  day  with 
each,  and  about  twenty  schools  would  be  the  limit  for  each 
teacher,  if  real  progress  is  expected.  In  most  states  there  is 
probably  no  provision  in  the  laws  for  the  appointment  and 
payment  of  special  teachers  serving  a  large  number  of  schools, 
and  the  securing  of  such  legislation  must  be  the  first  practical 
step  towards  the  introduction  of  such  studies,  except  as  indi- 
vidual districts  may  act  by  securing  regular  teachers  who  are 
qualified  for  the  work. 

Little  good  will  be  accomplished  by  moving  too  fast,  and 
in  advance  of  public  sentiment.  At  one  time  the  law  of  Cali- 
fornia required  that  "entomology"  should  be  taught  in  all  the 
common  schools  of  the  state.  This  provision  was  inserted  in 
the  statute  as  the  result  of  the  work  of  one  enthusiast,  wdio 
appreciated  the  importance  of  such  instruction  in  fruit-growing- 
districts,  and  who  had  himself  prepared  a  text-book  for  the 
purpose.  It  was,  however,  a  subject  hardly  understood  by 
anybody.  The  methods  of  dealing  with  insect  pests  were 
crude  and  unsatisfactory.  There  was  no  attempt  to  deal  witli 
fungi,  which  are  almost  as  destructive  as  insects.  In  the 
majority  of  the  districts  there  were  no  important  fruit  interests. 
The  teachers,  of  course,  knew  nothing  about  tlie  subject,  and 


AGRICULTURE    IN    THE    COMMON    SCHOOLS.  67 

usually  ridiculed  the  idea  of  teaching  any  such  thing  to  chil- 
dren. Such  attempts  as  were  made  to  carry  out  the  law  were 
in  most  cases  wholly  futile.  In  a  few  years  the  law  was 
repealed,  to  the  relief  of  all  connected  with  the  schools.  In 
the  meantime,  however,  since  the  law  was  on  the  statute-books, 
a  large  number  of  teachers  endeavored  to  prepare  themselves 
for  it.  The  subject  was  introduced  in  the  normal  schools,  and 
the  classes  in  entomology  in  the  University,  which  had  always 
been  very  small,  at  once  began  to  grow,  and  were  soon  large 
and  interesting.  When  the  law  was  repealed  they  at  once  fell 
back  almost  to  their  old  numbers.  All  this  shows  that  it  is 
usually  impossible  to  push  reforms  much  in  advance  of  public 
sentiment,  and  yet  that,  if  enacted  into  law,  and  kept  long 
enough  on  the  statute-book,  such  a  movement  will  in  the  end 
result  in  an  adequate  supply  of  those  competent  to  carry  it  on. 
The  California  law  was  repealed  just  as  it  was  about  to  become 
possible  to  properly  execute  it.  It  was  very  faulty,  however, 
in  that  it  made  insect  life  the  main  end  of  study,  which  should 
be  plant  physiology  and  hygiene. 

The  foregoing,  with  a  perusal  of  the  documents  relating  to 
this  subject  which  will  be  found  in  the  appendix,  will  give  an 
idea  of  the  conception  of  agricultural  instruction  in  the  common 
schools  as  it  exists  to-day.  Its  object  is. to  impart  to  children 
such  elementary  knowledge  as  is  possible  of  all  the  natural 
sciences  underlying  the  operations  of  the  farm.  In  the  present 
crowded  state  of  our  school  curriculums,  the  introduction  of  a 
new  subject,  in  w^hich  any  real  progress  is  expected,  must 
usually  involve  the  displacement  of  something  else.  One 
practical  question  must  be  as  to  what  shall  be  omitted  that  is 
now  taught.  There  will  be  advocates  of  that  subject,  whatever 
it  may  be,  who  will  fight  its  displacement.  In  rural  schools  it 
is  not  at  all  unusual  for  the  teacher  to  conduct  twenty-five  or 
thirty  recitations  each  day.  The  actual  school  day,  deducting 
recesses,  is  about  three  hundred  and  twenty  minutes.  Dividing 
this  number  by  thirty,  the  average  time  that  can  be  devoted  to  a 
recitation  is  but  little  over  ten  minutes.  If  there  are  but  twenty 
recitations  per  day,  the  average  time  for  each  is  sixteen  minutes. 
Any  effective  study  of  natural  science  will  use  up  several  of 


68  THE    FARMER  S    EDUCATION. 

these  periods,  and  invariably  occupy  the  attention  of  every 
pupil  in  tlie  school  as  long  as  it  lasts,  which  should  be  evidence 
that  it  is  adapted  to  their  mental  attainments.  This  practical 
question,  with  that  of  the  securing  of  competent  teachers,  suit- 
able appliances,  and  the  necessary  financial  support,  are  the 
main  problems  to  be  dealt  with  in  connection  with  the  study 
of  agricultural  science  in  common  schools.  None  of  tliem  are 
yet  solved,  and  in  fact  have  hardly  yet  been  seriously  considered. 


(CHAPTER  VII. 

AGRICULTURAL  PAPERS  AND  BOOKS. 

ONE  of  the  curious  things  which  must  be  taken  account 
of  is  the  intense  prejudice  which  exists  among  large 
masses  of  farmers  against  what  they  call  "book- 
farmers"  and  "book-farming."  Everything  has  its  cause,  and 
there  is,  of  course,  a  cause  for  this  prejudice.  In  part  it  is 
accounted  for  by  the  very  unpractical  character  of  some  popular 
books  on  farming  which  were  published  a  half  century  since. 
There  was  good  literature  on  the  subject  even  tlien,  but  it  did 
not  seem  to  get  into  popular  form.  Allowing  for  the  advance 
in  scientific  knowledge  since  that  time,  there  is  very  little  to 
which  modern  science  can  take  exception  in  the  old  cyclo- 
pedias, for  example,  whicli  had  the  widest  popular  circulation, 
and  in  which  the  agricultural  articles,  written  by  the  best  men 
of  the  time,  are  clear  and  sensible.  The  first  really  popular 
movement  towards  scientific  agriculture  was  based  on  the  idea 
of  controlling  fertility  by  the  operations  of  chemistry.  There 
were  then  few  agricultural  chemists  in  this  country,  and  they 
doubtless  had  rather  exaggerated  ideas  of  the  possibilities  of 
agricultural  chemistry;  and  these,  as  conceived  by  the  people, 
were  still  more  impossible.  There  was  an  abundance  of  virgin 
soil  to  be  had  for  the  asking,  and  more  money  could  be  gen- 
erally made  by  robbing  that  than  by  improving  that  which 
had  begun  to  be  exhausted.  Analysis  of  his  soil  in  advance 
was  practically  impossible  to  most  farmers,  who,  so  far  as  they 
used  commercial  fertilizers  at  all,  used  them  blindly,  and  often 
witliout  much  regard  to  mechanical  and  climatic  conditions, 
or  the  special  needs  of  the  different  plants.  The  result  of 
these  exaggerated  notions,  usually  still  farther  exaggerated 
and  unintelligently  applied,  was  a  great  reaction  from  what 
at  first  was  a  promising  movement,  and  a  deep-seated  preju- 
dice against  "  scientific  fellers  "  of  all  kinds,  which  has  been 

(69) 


70  THE    FARxMER  S    EDUCATION. 

transmitted  to  this  day.  Agricultural  chemistry  is  even  yet 
one  of  the  least-understood  sciences,  and  while  certainly  of 
great  importance,  is  less  reliable  as  a  source  of  profit  than 
almost  any  other  of  the  applications  of  science  to  agriculture. 
At  the  same  time,  so  deep-rooted  and  permanent  are  these 
popular  impressions,  that  the  general  notion  of  "  agricultural 
science"  and  "agricultural  books"  is  almost  exclusively  that 
of  the  employment  of  commercial  fertilizers  under  the  direc- 
tion of  chemists. 

Another  reason  for  this  wide-spread  prejudice  is  the  fact 
that  very  few  farmers  ever  read  the  books  tliey  condemn. 
As  a  matter  of  fact,  with  all  the  shortcomings  of  the  old 
books  on  agriculture,  they  contained  a  great  deal  of  useful 
information  and  sensible  discussion.  For  the  most  part,  what 
the  farmers  objected  to  was  not  what  the  books  contained,  but 
what  they  imagined  they  contained.  No  prejudice  is  so  bitter 
as  that  founded  on  absolute  ignorance.  Still  another  reason 
is  the  gradual  sapping  of  the  farmer's  intellectual  vigor  by 
the  flood  of  cheap  periodical  literature,  seldom  reliable, 
largely  sensational,  and  always  ephemeral,  which  now  infests 
the  earth.  In  the  old  days  most  farmers  had  a  few  well-bound 
books,  handed  down  from  former  generations,  very  solid  in 
character,  and  which  were  read  and  reread  of  the  long  even- 
ings until  thoroughly  mastered.  The  daily  paper  he  happily 
knew  nothing  of.  Such  training  tended  to  make  strong  minds 
and  thoughtful  men.  It  is  now  hardly  possible,  from  sheer 
intellectual  weakness,  for  a  large  portion  of  our  farmers  to 
attack  and  master  the  intricate  agricultural  problems  which 
confront  them.  The  majority  will  yield  to  the  inclination  to 
drop  study  for  the  newspaper  the  moment  it  comes  in.  And 
yet  it  is  seldom  that  the  contents  of  the  daily  paper  are  of  any 
special  consequence.  The  habit  of  newspaper-reading  also 
begets  the  habit  of  superficial,  hasty  reading  of  all  publica- 
tions, whereby  the  real  meaning  of  the  author  is  missed. 
If  it  be  said  that  what  is  said  here  is  by  no  means  true  of 
all  farmers,  the  reply  must  be  that  it  is  in  the  main  true  of 
that  portion  of  them  who  are  most  prejudiced  against  book- 
ll  farming. 


AGRICULTURAL    PAPERS    AND    BOOKS.  71 

Another  cause  of  the  prejudice  is  the  undoubted  fact  that 
comparatively  few  farms  owned  by  city  men,  who  are  usually 
the  devotees  of  book-farming,  are  a  source  of  profit  to  their 
owners.  In  some  cases  these  gentlemen,  doubtless,  make  grave 
mistakes,  for  a  successful  farmer  is  as  unlikely  to  be  made  by  the 
study  of  books  alone  as  a  successful  merchant  or  manufacturer. 
All  books  on  farming  presuppose  their  readers  to  be  practical 
farmers,  familiar  from  boyhood  with  the  details  of  farm  work, 
and  consequently  able  to  apply  scientific  doctrine  in  the  light 
of  common  sense  and  experience.  Whoever,  without  expe- 
rience, undertakes  to  carry  on  a  farm,  is  as  likely  to  come  to 
grief  as  he  who  so  undertakes  to  carry  on  a  factory.  Finally, 
it  is  as  true  now  as  in  Ben  Franklin's  time  that 

"  He  who  by  the  plow  would  thrive 
Must  either  hold  himself,  or  drive." 

No  farm  to  which  the  actual  owner  does  not  give  his  prin- 
cipal attention  and  thought  is  likely  to  be  profitable.  The 
"  practical  farmer "  who  should  undertake  to  carry  on  his 
farm  by  weekly  visits  only,  would  be  even  less  likely  to  secure 
profitable  results  than  the  city  man  who  adopts  the  same 
course. 

As  a  matter  of  fact,  however,  substantially  all  books  on 
agriculture  which  are  now  issued,  are  the  work  of  intensely 
practical  men  wdio  place  their  experience  and  observation  at 
the  command  of  mankind.  They  are  compact  and  complete 
statements  of  what  the  author  knows,  and  are  of  the  utmost 
value  to  the  practical  farmer  who  will  make  use  of  them.  It 
would  be  difficult,  if  not  impossible,  for  a  poor  book  to  find 
a  publisher,  for  even  the  very  best  books  yield  hardly  any 
revenue  either  to  publishers  or  authors,  for  the  reason  that 
farmers  do  not  buy  them.  In  the  long  run,  I  suppose  those 
which  get  published  pay  for  themselves,  but  I  doubt  whether 
Professor  King's  invaluable  book  on  "Soils,"  for  example,  has 
ever  paid  its  author  a  dollar  a  day  for  the  time  actually  spent 
in  writing  it  and  correcting  the  proof  sheets,  to  say  nothing 
of  pay  for  the  time  speni  in  acquiring  the  information.  I 
have  prepared,  as  very  valuable  information,  a  list  of  some  late 
books  on  agriculture,  with  publishers  and  price,  which  will  be 


72  THE  farimer's  educatiox. 

found  in  the  appendix.*  It  is  doubtless  not  complete,  but  it 
will  enable  readers  to  find  reliable  information  on  most  subjects 
connected  with  farming. 

The  most  important  sources  of  information  for  farmers  are 
the  publications  of  the  state  and  national  govt'rnments.  I 
have  already  (page  49)  alluded  to  these,  and  the  appendix 
will  indicate  how  any  farmer  may  obtain  them.  Tliey  are, 
for  the  most  part,  sent  free  on  ai)plication,  and  when  a  price 
is  fixed,  it  is  the  exact  cost.  I  call  these  the  most  important 
because  they  are  the  most  accessible  and  cheapest.  They  are 
nearly  always  brief  monographs  on  special  subjects,  and  do 
not  by  any  means  serve  the  purpose  of  more  extended  trea- 
tises by  the  same  or  equally  competent  gentlemen,  which  are 
published  as  books  by  private  publishers. 

The  agricultural  press  as  now  conducted,  is  of  very  great 
value  to  farmers.  All  farmers  worthy  of  the  name  take  one 
or  more  agricultural  journals  and  find  them  essential.  At  the 
same  time  there  are  various  limits  to  their  usefulness.  The 
first  and  most  important  is  the  necessity  of  publishing  such  a 
paper  that  the  income  will  pay  its  expenses,  and  if  possible 
leave  a  profit.  A  paper  which  does  not  pay  must  soon  stop. 
For  most  agricultural  papers,  however,  there  is  little  or  no 
profit  iu  subscriptions.  It  costs  so  much  to  got  and  collect 
them  that  if  it  were  possible  to  obtain  an  income  from  adver- 
tisements by  printingonly  a  sufficient  number  to  supj)ly  each 
advertiser,  in  a  great  many  cases  the  publisher  would  be  a 
gainer.  But  the  circulation  is  necessary  in  order  to  secure 
advertising,  and  it  is  kept  up  by  canvassers,  by  sending  the 
paper  on  credit,  which  always  involves  large  losses,  by  "pre- 
miums," "clubbing"  arrangements,  and  other  devices,  all  of 
which  cost  money.  The  advertising  space  in  ]ia})ers  going 
exclusively  to  farmers  is  also  of  less  value  than  in  papers  of 
general  circulation,  because  farmers  are  considered  as  having 
least  money  to  spend. 

The  necessity,  therefore,  of  an  advertising  ])atronage  in 
order   to   publish    any    agricultural    })aper,   in    various    ways 


*  See  Appendix  D. 


AGRICULTURAL    PAPERS    AND    BOOKS.  io 

interferes  with  its  value.     A  manufacturer  of  fertilizers  will 
not    advertise   in   a  journal   which    persistently   advises    its 
readers  to  compound  their  own  fertilizers;  and  if  the  money  is 
needed,  the  editor  must  keep  still,  whatever  he  thinks.     The 
commission  merchants  will   not  advertise  'in  a  paper  which 
urges  the  farmers  to  form  cooperative  marketing  associations, 
or  the  insurance  companies  in  those  which  advocate  farmers' 
mutual  insurance  companies,  and  so  on  througli  the  list.     In 
fact,  to  most  agricultural  journals  the  free  discussion  of  the 
real  merits  of  any  article  or  interest  in  which  private  capital 
is  involved,  is  practically  impossible.     Wild  horses  would  at 
the  present   time  be   unal)le  to  drag  from  any  agricultural 
editor  his  printed  opinion  as  to  the  relative  merits  of  the  com- 
peting milk  separators.     AVe  may  say  that  this  is  not  right; 
that  the   subscriber  i)ays  the  journal  not  only  for  the  infor 
mation  which  it  gives,  but  for  the  best  jndgment  of  the  editor 
on  all  questions  that  concern  agriculture.     The  reply,  how- 
ever, must  be  that  the  farmer  does  nothing  of  the  kind.     As 
a  class  he  pays  next  to  nothing  for  the  paper,  after  deducting 
the  cost  of  getting  the  business.     Tliere  are,  of  course,  some 
agricultural  journals   of  which    this  is  not  true,  but  of  the 
majority  it  is  quite  true.     They  get  their  income  from  others 
than  farmers,  and  must  so  shape  their  course  that  those  who 
keep  them  alive  are  satisfied.     If  they  do  not  they  will  die. 
They  do  the  best  they  can,  and  seldom  or  never  lend  them- 
selves to  actual  deception,  but  free  discussion,  wholly  in  the 
interest  of  farmers,  will  never  be  possible  until  the  farmers 
supply  the  income  to  support  it.     On  tliese  terms  they  can  get 
it  any  day. 

Another  limitation  is  the  intricacy  of  modern  agricultural 
affairs,  the  constant  intermingling  and  conflict  of  agricultural 
interests  wiih  each  other  and  with  competing  interests,  and 
the  world-wide  ramifications,  which  it  requires  world-wide 
information  to  comprehend.  There  is  also  the  constant  prog- 
ress of  science,  whicli  must  be  followed  and  treated.  Before 
all  this  the  agricultural  journal  is  positively  helpless.  No 
such  journal  in  the  world  can  pay  from  its  receipts  the 
expenses  of  adequate  treatment  of  agricultural  topics. 


74  THE    FARMER  S    EDUf'ATTON. 

The  agricultural  press,  therefore,  on  such  matters  is  com- 
pelled to  fall  back  on  public  documents  and  the  utterances 
of  experts  at  Farmers'  Institutes  and  similar  gatherings.  Of 
these,  fortunately,  the  supply  is  abundant,  and  one  of  the 
most  useful  functions  of  the  agricultural  press  is  the  republi- 
cation and  condensation  of  this  material. 

Tlie  journals  of  special  industries,  like  the  dairy,  the  poultry 
yard,  or  the  fruit  farm,  are  usually  conducted  by  successful 
specialists  in  those  lines,  and  give  much  original  information. 
Of  the  important  papers  of  general  agriculture  probably  all 
are  conducted  by  those  who  are  or  have  been  successful 
farmers.  Many  of  the  editors  own  and  live  upon  farms, 
but  this  tends  to  be  otherwise,  because  no  man  can  be  a 
good  editor  and  successful  farmer  at  the  same  time.  To  do 
either  will  require  all  his  energy,  and  he  will  tend  to  give 
up  one  occupation  or  the  other. 

The  live  agricultural  paper  keeps  the  farmer  well  informed 
as  to  imi)roved  methods,  progress  of  science,  and  the  intro- 
duction of  new  farming  industries,  and  for  this  purpose  it  is 
worth  to  the  farmer  far  more  than  he  pays  for  it.  It  gives 
him  a  great  deal  of  definite  information  of  value  to  him,  and 
shows  him  how  to  investigate  further.  It  will  always  gladly 
investigate  special  problems,  as  to  whicli,  although  the  editor 
may  know  little,  he  is  usually  in  a  position  to  ascertain  the 
facts. 

In  an  agricultural  journal  nothing  is  read  with  more  inter- 
est, or  is  really  of  more  value,  than  the  correspondence  which 
it  contains  from  practical  farmers  on  practical  subjects.  It  is 
also  true  that  few  things  are  more  valuable  to  the  farmer  than 
the  habit  of  contributing  liis  experience  to  his  agricultural 
])n])er.  In  the  first  place,  tlie  act  of  writing  condenses  his 
ideas  into  a  compact  form,  and  discloses  to  iiimself  any 
errors  of  reasoning  or  gaps  in  information.  It  i)uts  his  knowl- 
edge into  more  workable  shape,  for  his  own  use,  or  for  impart- 
ing to  others.  To  an  extent  which  will  suri)rise  Iiimself,  it  will 
also  make  liim  known  to  his  community,  and  to  the  extent 
that  his  views  are  sensible,  ho  will  find  himself  respected  and 
influential,  which    is  always  a  jdeasure.     One  who  is  in  the 


AGRICULTURAL   PAPERS   AND    BOOKS.  75 

habit  of  contributing,  over  bis  own  signature,  to  an  agricul- 
tural journal,  will  be  astonished  to  tind  how  many  have  heard 
of  him,  and  are  glad  to  know  him,  should  he  happen  for  the 
first  time  to  visit  a  state  fair  or  other  large  gathering  of 
farmers.  The  habit  of  writing  also  leads  to  the  habit  of 
study  and  self-improvement. 

Some  farmers  who  would  frequently  contribute  valuable 
experience  to  the  public,  are  restrained  b}^  the  feeling  that  they 
can  not  express  themselves  well,  perhaps  can  not  spell  well, 
or  write  well.  These  need  not  trouble  any  one.  The  writing 
must  be  legible,  and  be  written  on  one  side  of  the  paper  only. 
Otherwise  it  does  not  matter  how  it  looks,  or  what  the  spelling 
is,  or  how  it  is  expressed.  If  it  is  all  right,  it  will  save  the 
editor  some  work,  but  that  work  is  what  he  is  paid  for,  and 
what  he  has  to  perform  on  the  majority  of  communications 
sent  in.  As  it  appears  in  the  paper  it  will  read  all  right,  and 
nobody  but  the  editor  will  ever  know  that  it  was  otherwise, 
and  he  will  forget  it  in  a  week.  Any  editor  who  can  obtain 
valuable  suggestions  or  narrations  of  useful  experience,  is  only 
too  glad  to  put  them  into  pro]3er  form,  provided  only  that  the 
communication  is  legible,  and  not  written  on  two  sides  of  the 
paper,  which  always  involves  copying  out  for  the  printer, 
which  no  editor  will  do  unless  the  subject  matter  be  more  than 
ordinarily  important. 

The  agricultural  press  does  its  very  best  for  the  farmer,  and 
should  be  cordially  sustained  by  prompt  payment  of  subscrip- 
tion money  and  the  contribution  of  experience  and  suggestions 
for  its  columns. 


CHAPTER    VIII. 


THE    STUDY    OF    THE    FARM. 


THE  foregoing  review  of  the  principal  agencies  external 
to  the  farm  which  the  fanner  may  employ  to  increase 
his  knowledge,  has  prepared  us  to  consider  that  greatest 
of  all  means  for  self-improvement,  which  is  the  study  of  the 
farni  itself.  If  the  somewhat  elaborate  study  of  other  agencies 
has  led  any  reader  to  imagine  that  I  suppose  that  any  one  can 
becom.e  a  good  farmer  by  any  other  means  than  by  faithful 
devotion  to  the  duties  of  the  farm,  I  beg  that  he  now  recognize 
that  he  is  in  error.  It  is  only  on  and  by  the  farm  that  the  man 
can  become  a  farmer. 

It  is  this  feeling  which  all  engaged  in  any  industr}'  possess 
that  only  by  the  practice  of  an  art  can  the  art  be  learned,  that 
is  doubtless  at  the  bottom  of  the  farmer's  distrust  of  "  book 
farming;"  his  error  consists  in  supposing  that  any  intelligent 
person  believes  otherwise.  The  external  aids  in  the  way  of 
schools,  lectures,  books,  and  experiments,  are  to  be  understood 
as  aids  and  nothing  more.  They  put  the  farmer  in  possession 
of  information  acquired  by  others,  which  he  may  apply  to  his 
own  advantage  upon  his  own  farm;  and  the  farmer  who  thinks 
that  he  can  successfully  compete  without  more  or  less  of  this 
{lid,  and  refuses  to  accept  it  wdien  offered,  is  in  all  probability 
a  lost  man.  Any  farmer  who  could  by  any  possibility  be  con- 
sidered smart  enough  to  succeed  with  only  his  own  experience 
as  a  guide,  will  be  the  first  man  of  all  to  avail  himself  of  tlie 
experience  of  others.  But  of  all  studies,  that  of  one's  own  farm 
is  the  most  important. 

In  the  study  of  a  farm,  it  is  probable  that  hardly  any  two 
men  would  proceed  alike.  Each  man,  knowing  certain  things, 
would  endeavor  to  add  to  his  knowledge  in  such  directions  as 
he  felt  a  lack,  and  in  so  doing  would  proceed  according  to  the 

(76) 


THE   STUDY    OF    THE    FARM.  77 

nature  of  the  knowledge  already  in  hand,  and  his  own  habit 
of  mind.  What  I  am  about  to  say  will  simply  indicato  how  I 
should  personally  approach  the  subject,  and  will  give  some 
idea  of  what  I  mean  by  the  study  of  the  farm. 

When  a  man  has  lived  upon  a  farm  for  ten  years,  tiie 
number  of  things  which  he  knows  about  it  is  enormous.  If  il 
is  a  small  farm,  tilled  with  his  own  hands,  he  can  lie  on  his 
bed  and  call  to  mind  an  infinite  number  of  details:  the  slopes, 
the  different  soils,  the  weed  patches,  the  fruit  trees,  and  even 
insignificant  details  of  the  fence  corners,  clumps  of  brush  in 
the  pasture,  a  stray  thistle  here  and  there,  and  a  multitude  of 
things,  some  important  and  others  of  no  consequence.  If  called 
upon  for  any  special  item  of  information,  the  question  will 
suggest  to  him  many  other  things  not  before  thought  of;  in 
short,  he  will  himself  be  surprised  at  the  number  of  details 
which  he  has  unconsciously  absorbed,  and  which  are  ready 
for  his  use  so  far  as  they  have  value.  Of  course  men  differ 
wonderfully  in  their  capacity  for  seeing;  some  see  almost 
everything,  and  others  comparatively  little.  The  latter  class 
will  possess  a  great  part  of  their  knowledge  as  a  rather  hazy 
impression,  which  they  would  find  it  very  difficult  to  reduce 
to  words.  For  such  men  the  first  thing  of  all  is  to  learn  to  see. 
This  habit  is  easiest  acquired  in  childhood,  when  curiosity  is 
active  and  the  eyes  at  their  best;  and  the  greatest  benefit  to  be 
derived  from  the  study  of  agricultural  science  in  the  common 
schools  is  the  early  acquirement  of  the  art  of  seeing. 

A  systematic  study  of  the  farm  consists  first  in  the  separa- 
tion in  the  mind  of  the  important  from  the  unimportant  facts; 
second,  the  formation  of  a  mental  judgment  as  to  the  relative 
importance  of  each,  and  the  reason  therefor;  third,  acquiring  a 
clear  perception  of  what  essential  knowledge  is  lacking,  and 
finally  the  acquirement  and  utilization  of  that  knowledge. 

I  will  assume  that  a  man  has  lived  ten  years  on  a  farm 
with  ordinarily  good  health,  and  no  serious  misfortunes,  such 
as  fire  or  pestilence,  and  yet  has  made  no  headway.  If  he 
owed  money  at  the  beginning,  he  owes  it  still.  He  feels  that 
he  has  been  prudent  in  expenditure,  and  knows  that  he  has 
been  industrious,  and  yet  has  not  got  on.     He  now,  having 


78  THE  farmer's  education. 

read  the  foregoing,  sits  down  to  "study  his  farm,"  to  find  out 
what  the  trouble  is. 

The  first  thing  he  will  require  is  absolute  frankness  with 
himself.  If  he  sets  out  in  his  study  with  the  intent  to  prove 
something,  he  might  almost  as  well  not  begin.  He  is  about, 
whether  he  knows  it  or  not,  to  engage  in  "scientific  farming," 
and  the  first  teaching  of  science  is  to  follow  truth  wherever  it 
loads.  If  his  study  of  the  farm  convinces  him  that  the  farm 
is  all  right  but  that  the  error  is  in  the  way  he  has  used  it,  he 
must  be  prepared  to  accept  the  conclusion. 

In  the  first  place  he  will  consider  what  crops  he  has  raised 
and  is  now  raising.  He  is  producing  to  sell.  Where  is  his 
market?  Who  will  ultimately  consume  his  produce?  How 
is  it  to  get  to  the  consumers?  What  will  it  cost  to  get  it 
there,  including  pay  to  those  necessarily  handling  it?  What 
competition  will  it  meet  in  the  final  market?  How  is  he 
prepared,  under  natural  conditions  as  they  exist,  to  sustain 
competition?  From  what  points  can  an  adequate  supply  be 
delivered  to  the  markets  in  which  he  must  compete?  Of  these 
points  which  can  probably  produce  cheapest?  With  all  these 
questions  satisfactorily  answered,  he  is  prepared  to  study  the 
conditions  of  his  own  farni.  If  the  result  of  this  study  con- 
vinces him  that  he  is  among  the  number  of  those  who  ought 
to  produce  most  chea2:)ly,  and  his  crops  are  articles  of  staple 
production,  he  has  established  the  fact  that  it  is  probably  not 
by  a  change  of  crops  that  he  is  to  better  his  condition.  More 
especially  will  this  be  the  case,  if,  upon  looking  about,  he  finds 
some  of  his  neighbors  who  have  been  producing  the  same 
crops,  to  be  personally  prosperous.  His  conclusion  must  be 
that  his  crops  cost  him  too  much,  and  more  than  similar 
crops  cost  others. 

The  next  step  is  to  tui'u  to  his  own  books  and  examine 
closely  the  items  of  his  own  costs.  If,  as  will  j)erhaps  be  the 
case,  he  finds  there  only  blank  pages,  or  accounts  so  kept  that 
he  can  not  accurately  tell  the  details  of  the  cost  of  anything, 
he  can  only,  for  the  present,  reach  the  conclusion  that  some 
one  is  producing  cheaper  than  he,  but  he  does  not  know  how. 

This  may  seem  an  awkward  way  to  reach  a  study  of  the 


THE    STUDY    OF    THE    FARM.  V'J 

farm.  It  may  not  be  the  best  way.  It  is  the  way  I  should 
naturally  reach  it,  because  I  could  only  study  it  with  real 
interest  when  looking  for  some  particular  thing,  and  l)efore 
minutely  studying  the  farm  in  the  search,  should  wish  to 
satisfy  myself  whether  it  is  probably  there. 

Suppose  that  I  discover  that  in  raising  wheat  my  average 
crop  is  fifteen  bushels  per  acre,  and  I  am  making  no  money, 
while  my  neighbor,  who  is  getting  ahead,  gets  twenty  bushels 
to  the  acre  on  an  average.  My  study  would  be,  how,  with 
the  least  additional  expense,  I  could  add  five  bushels  a  year  to 
my  average  crop.  My  trouble  may  be  either  in  insufficient 
tillage,  or  insufficient  fertility,  or  both,  or  in  the  character  of 
the  land.  If  the  latter,  it  is  evident  that  unless  by  drainage, 
or  some  other  practicable  methods,  I  can  change  the  character, 
of  the  soil,  I  had  better  make  a  change  of  my  crop.  If  bad 
tillage  or  insufficient  fertility  is  the  cause  of  light  crops;  my 
object  will  be  to  discover  how  I  can  most  economically  change 
these  conditions.  If  my  neighbor's  land  and  my  own  were 
originally  alike,  and  his  is  now  in  better  condition,  it  must  be 
accepted  in  my  mind  that  he  is  an  abler  man  than  myself, 
and  better  farmer,  and  that  I  can  not  probably  do  better  than 
to  watch  his  methods  and  follow  them. 

This  is  always  the  conclusion  hardest  to  accept.  No  man 
will  willingly  admit  that  another  is  abler  than  himself,  but  if 
the  facts  show  it,  it  must  be  accepted  if  any  progress  is  to  be 
made.  Failure  in  farming,  in  the  absence  of  sickness  or  other 
special  misfortune,  is  due  either  to  the  farm  or  the  farmer. 
The  study  of  the  farm  should  show  which,  and,  the  conclusion 
once  reached,  effort  must  be  directed  to  the  improvement  of 
the  element  at  fault.  If  the  farm  is  fertile,  or  has  once  been 
so,  the  fault  is  evidently  in  the  farming,  and  this  may  be 
either  in  choosing  crops  not  suited  to  the  land,  or  for  which 
there  is  no  adequate  market,  or  in  poor  rotations,  or  the 
absence  of  any  rotation,  or  in  constant  robbing  of  the  soil 
with  no  return  of  fertilizers,  or  in  bad  tillage,  or  in  uneco- 
nomical management.  The  study  of  the  farm,  especially  in 
connection  with  a  book  showing  details  of  cost,  should  show 
which. 


80  THE    FARMER  S    EDUCATION. 

The  study  of  the  farm  means  the  acquirement  of  a  detailed 
knowledge  of  the  soils,  exposures,  and  moisture,  in  connection 
with  crops  adapted  to  them.  It  is  no  reflection  on  farmers  to 
say  that  few  of  them  know  how  to  study  the  farm  or  anything 
else.  The  art  of  study  is  itself  one  of  the  most  difficult  of  all 
arts.  The  main  object  of  a  University  education  is  to  learn 
how  to  study,  and  the  seven  or  eight  years  required  for  the 
Bachelor's  degree  is  none  too  much  to  acquire  that  ability.  It 
is,  therefore,  no  reflection  on  any  one  who  has  not  had  that 
training,  to  say  that  he  probably  does  not  know  how  to  study, 
and  the  following  suggestions  as  to  methods  for  studying  the 
farm  may  serve  to  show  how  a  trained  mind  might  approach 
the  subject. 

First,  make  a  complete  list  of  farm  crops  possible  to  be 
raised  in  the  locaUty.  Among  these  are  almost  sure  to  be 
some  not  now  raised  at  all.  Mark  this  list  in  the  order  of 
their  importance  as  indicated  by  their  relative  volume.  Those 
of  which  the  most  are  used  are  most  certain  of  prompt  sale. 
Against  each  crop  note  the  nature  of  the  soil  and  climate  best 
adapted  to  it.  Then  study  the  markets  for  each  product,  your 
distance  from  them,  and  the  cost  of  transportation  thereto. 
Flax  products,  for  example,  are  consumed  in  linen  and  twine 
factories,  and  in  oil  mills.  A  farmer  at  a  great  distance  from 
either  might  find  it  difhcult  to  dispose  of  his  crop  even  if  well 
situated  for  its  economical  production.  Wheat,  on  the  con- 
trary, is  salable  everywhere  because  consumed  everywhere. 
It  is  always  an  advantage  to  raise  a  crop  largely  produced  in 
the  vicinity,  because  its  volume  will  tend  to  attract  cash  buyers, 
while  a  crop  of  which  little  is  produced  must  always  be  trans- 
ported to  market  at  producer's  risk  and  expense,  and  usually 
sold  through  commission  merchants.  At  the  same  time  men 
of  exceptional  shrewdness  and  vigor  often  do  well  by  devot- 
ing themselves  to  something  out  of  the  way  for  which  they 
liave  discovered  or  created  a  special  market. 

When,  by  carefully  eliminating  from  the  list  of  possi- 
bilities those  crops  which  seem  to  offer  least  hope  of  profit,  it 
has  been  reduced  to  a  comparatively  small  number,  it  is  time 
to  take  up  the  capacities  of  the  farm.     These  are  determined 


THE    STUDY    OF    THE    FARM.  81 

by  its  chemical  constituents  (fertility)  and  its  physical  quali- 
ties, including  texture,  moisture,  exposure,  and  climate.  Com- 
paring these  with  tlie  conditions  required  for  the  different 
crops,  the  farmer  will  be  able  to  judge  what  he  can  produce 
most  cheaply,  and  sell  most  surely,  and  by  what  rotations  he 
can  best  maintain  his  land  in  good  condition  both  as  to 
fertility  and  mechanical  condition.  The  farmer  who  has  once 
made  such  a  study  of  his  farm  will  feel  such  a  confidence  and 
assurance  in  prosecuting  whatever  branch  of  the  industry 
he  may  finally  decide  upon,  as  he  never  felt  before.  He  will 
feel  that  he  is  master  of  his  business.  If  it  be  said  that  our 
fathers  succeeded  without  any  such  study,  the  reply  is  that 
our  fathers  lived  under  different  conditions.  Modern  compe- 
tition has  invaded  farm  life,  and  those  only  can  succeed  who 
are  competent  to  sustain  themselves  under  competition ;  and 
those  who  can  live  under  competition  are  those  who  know- 
how  to  so  direct  effort  tliat  there  shall  be  the  least  possible 
waste.  It  is  waste  of  effort  that  kills,  and  it  is  study  that 
prevents  waste. 


CHAPTER    IX. 

A  FURTHER  STUDY  OF  THE  FARM. 

[By  L.  a.  Clinton,  Assistant  Agriculturist  Cornell  Uuiveisity.] 

The  Farm  as  a  Home.* 

ANY  person  who  contemplates  purchasing  a  farm,  upon 
which  to  establish  himself,  and  secure  a  living,  should 
make  a  most  careful  study  before  deciding  upon  the 
farm  to  be  purchased.  There  are  many  features  whicli  should 
be  considered  besides  the  one  of  securing  a  competence,  "foL* 
it  is  not  all  of  life  to  live."  First,  there  should  be  considered 
the  adaptability  of  the  farm  for  a  home.  Unless  it  possesses 
in  itself  and  by  environment  those  qualities  which  go  toward 
making  a  pleasant  and  healthful  location  for  a  home,  then 
the  study  should  not  proceed  further,  but  some  other  farm 
should  be  selected.  '' 

In  selecting  the  site  for  a  home  there  should  be  considered 
healthfulness  of  location,  character  of  the  people  in  the  sur- 
rounding district,  nearness  to  churches  and  schools,  quality  of 
the  land  in  the  neighboring  farms,  nearness  to  the  market 
town,  and  quality  of  roads  leading  to  and  from  the  farm. 

Healthfulness  of  location  should  receive  first  attention,  for 
if  the  land  is  so  located  that  the  conditions  are  unsanitary  as 
regards  drainage,  water  supply,  etc.,  and  these  conditions  can 
not  be  remedied,  then  no  matter  how  favorable  the  other 
conditions  may  be,  the  farm  should  not  be  selected  for  a  home. 

The  character  of  the  surrounding  people,  whose  intelli- 
gence and  honesty  will  very  largely  give  the  reputation  to  the 
community,  will  materially  add  to  or  detract  from  the  value 


*  For  a  more  complete  discussion  of  this  subject  the  reader  is  referred  to 
book  entitled  "Rural  Affairs,"  .now  in  preparation,  by  Prof.  I.  P.  Roberts. 

(82) 


A    FURTHER   STUDY    OF    THE    FARM.  83 

of  any  farm  as  a  home.  The  social  advantages,  the  schools 
and  the  churches,  will  be  no  better  and  of  no  higher  order 
than  the  people  who  compose  the  community.  We  are  influ- 
enced more  6T  less  by  the  peoj^le  with  whom  we  come  in  con- 
tact. The  children  of  a  home  are  influenced  for  better  or 
worse  by  their  playmates.  Then  in  selecting  a  home  an 
important  consideration  should  be  the  character  of  the  people 
who  will  be  our  neighbors. 

The  churches  and  schools  are  important  civilizing  and 
educational  agencies.  A  live  church  in  a  community  adds  to 
the  desirability  of  that  community  as  a  home.  It  tends  to 
create  a  better  moral  atmosphere;  it  raises  the  general  stand- 
ard of  the  people;  and,  whether  we  wuU  or  not,  its  effect  is  to 
increase  the  value  of  any  district  as  a  location  for  a  home. 
The  importance  of  the  country  schoolhouse  is  general!}^  recog- 
nized, and  its  importance  is  increasing  each  year  as  better 
methods  of  instruction  are  adopted  and  more  attention  is  paid 
to  education.  All  classes,  educated  and  uneducated,  recog- 
nize in  the  school  an  agency  the  influence  of  which  is  second 
only,  if  not  equal,  to  that  of  the  church.  The  desirability 
of  the  home  is  increased  then  as  it  is  located  within  easy  reach 
of  the  schoolhouse,  so  that  the  children  of  the  family  can 
receive  the  benefits  of  the  instruction  there  imparted. 

It  is  not  only  important  that  the  land  be  fertile  on  the  farm 
to  be  purchased,  but  also  that  the  neighboring  farms  be  fertile. 
The  character,  disposition,  and  temperament  of  people  are  very 
largely  influenced  by  the  amount  of  labor  necessary  for  them 
to  secure  a  living.  If  the  surrounding  land  is  poor,  and  of  such 
a  nature  that  it  requires  the  maximum  expenditure  of  labor 
for  a  minimum  of  results,  then  the  opportunity  of  people  who 
live  upon  such  land  for  intellectual  development  is  limited, 
their  interest  in  public  improvements  is  likely  to  be  small, 
teachers  hired  for  the  public  school  are  usually  the  cheapest 
that  can  be  procured,  and  thus,  in  many  ways,  is  the  value 
of  a  farm  as  a  home  enlianced  or  diminished  according  to  the 
.nature  of  the  surrounding  lands. 

Distance  from  the  market  town  is,  to  a  large  extent,  deter- 
mined by  the  quality  of  the  roads.     With  the  advent  of  good 


84  THE  farmer's  education. 

roads,  when  it  will  be  possible  at  all  times  of  the  year  easily 
to  reacli  the  town,  the  distance  in  miles  will  become  of  less  im- 
portance. But  with  conditions  as  they  are  now  in  a  very 
large  proportion  of  our  rural  districts,  when,  for  a  part  of  the 
year,  the  public  highways  are  in  an  almost  impassable  con- 
dition, the  distance  ^/iroit^/i  which  one  must  travel  such  high- 
ways in  passing  to  and  from  the  market  should  have  an 
important  influence  in  determining  what  farm  should  be 
selected  for  a  home. 

The  Farm  as  a  Source  of  Income. — Being  in  possession  of  a 
farm,  there  is  then  at  hand  abundant  opportunity  for  study, 
and  the  ways  in  which  different  ones  will  take  up  the  study 
will  probably  be  as  various  as  the  farms  to  be  studied.  There 
are,  however,  certain  important  considerations  which  should 
be  given  careful  thought,  for,  no  matter  how  pleasant  the  loca- 
tion as  a  home,  if  one  can  not  secure  a  competence  upon  the 
farm,  tlien  it  will  be  necessary  to  look  to  other  employment  as 
a  means  of  sustenance. 

With  the  farm  there  is  possessed  not  only  a  certain  area 
which  can  be  measured  in  acres,  but  also  a  vast  amount  of 
plant  food,  raw  material,  from  which  are  to  be  manufactured 
certain  products.  The  plant  food  in  the  soil  really  consti- 
tutes the  stock  of  the  farmer.  The  value  of  this  stock  will 
be  determined,  very  largely,  by  the  treatment  the  land  has 
received,  the  availability  of  the  plant  food  in  the  soil,  the  tex- 
ture of  the  soil,  and  the  methods  of  agriculture  to  be  pursued. 

There  will  be  found  certain  fields  of  the  farm  which 
exceed  the  average  in  fertility,  and  other  fields  will  be  found 
deficient.  Those  fields  which  are  deficient  will  naturally 
receive  attention  first.  A  fertile  field  is  one  which  will  pro- 
duce crops  at  a  profit.  If  a  field  is  found  not  to  be  producing 
crops  at  a  profit,  then  investigation  should  be  commenced  at 
once  to  -determine  the  causes.  The  most  common  causes  of 
infertility  are  abuse  of  the  land,  poor  texture  of  the  soil,  lack 
of  adaptation  of  soil  to  crop  grown.  It  is  probable  that  the 
first  cause  mentioned  is  the  most  difficult  of  any  to  detect, 
and  it  is  one  of  the  most  common  causes  of  infertility. 

The  abuses  most  frequent  are  the  annual  removal  of  crops 


A    FURTHER    STUDY    OF   THE    FARM.  85 

without  any  returns  in  the  way  of  manures,  fertihzers,  or 
organic  matter,  and  the  leaving  of  the  h^nd  naked  during  the 
rainy  season,  and  thus  exposed  to  tlie  action  of  rains  and 
floods. 

So  generous  lias  been  the  supply  of  plant  food  that  the 
abuse  first  mentioned  may  have  been  going  on  for  several 
generations.  On  the  newer  lands  of  the  west,  this  system  of 
soil  robbing  is  still  going  on.  On  the  older-cultivated  lands  of 
the  east,  the  ruinous  effects  of  the  system  have  become  appar- 
ent, and  the  practice  has,  of  necessity,  been  checked.  If  it  is 
found,  upon  a  study  of  the  various  fields  of  the  farm,  that 
this  form  of  abuse  has  been  going  on,  then,  first  of  all,  the 
practice  should  be  discontinued,  and  means  taken  at  once  to 
restore  the  land  to  a  fertile  condition. 

The  loss  of  fertility  is  not  because  the  plant  food  has  all 
been  used,  for  that  has  been  impossible.  Only  that  plant  food 
has  been  used  which  could  be  most  easily  extracted.  There 
still  remains  an  abundance  of  plant  food  in  the  soil  for  the 
production  of  many  crops.  It  is  some  otlier  feature  besides 
plant  food,  then,  which  needs  first  to  be  studied  and  remedied. 
The  organic  matter  or  humus  of  the  soil  has  been  so  depleted 
that  it  is  no  longer  loose  and  mellow,  slightly  springy  or 
elastic  when  trodden  upon,  but  is  heavy,  compact,  and  runs 
together  in  an  almost  impervious  layer  under  the  action  of 
beating  rains.  This  condition  must  be  remedied.  Returns 
of  organic  matter  must  be  made  either  by  the  plowing  unde: 
of  green  crops  or  by  the  use  of  barn  manures.  Humus  is 
capable  of  holding  over  one  hundred  per  cent  of  its  weight  of 
water.  A  soil  that  is  deficient  in  this  important  constituent, 
humus,  is  thereby  deficient  in  its  moisture-holding  powei-. 
As  the  humus  of  the  soil  is  increased,  within  certain  limits, 
the  power  of  the  soil  to  hold  moisture  is  increased.  If  a 
careful  examination  of  the  condition  of  the  soil  shows  that  it 
is  lacking  in  humus,  one  of  the  cheapest  and  best  ways  by 
which  it  can  be  supplied  is  by  the  plowing  under  of  legumi- 
nous crops,  as  clover,  peas,  beans,  vetches,  etc.  If  the  land  is 
so  poor  that  these  plants  can  not  be  grown,  then  any  plant 
which  is  hardy  in  the  locality  and  is  what  we  call  a  "coarse 


86  THE  farmer's  education. 

feeder"  may  be  grown.  Among  such  feeders  may  be  men- 
tioned rye,  buckwheat,  spurry,  and  weeds  of  mfinite  variety, 
for  a  crop  of  weeds  plowed  under  is  far  better  than  nothing. 
But  why  all  this  work  and  apparent  loss  of  time? — Simply  to 
bring  to  our  command  some  of  the  vast  stock  of  plant  food 
which  we  possess,  that  we  may  be  enabled  profitably  to  manu- 
facture the  raw  materials  of  the  soil  into  a  product  for  which 
there  is  a  demand.  The  fermentation  and  decomposition  oi 
organic  matter  in  the  soil  creates  carbonic  acid;  this  acid  acts 
upon  the  elements  of  the  soil  and  makes  available  some  of 
the  plant  food  which  has  been  heretofore  locked  up ;  the 
condition  of  the  soil  has  been  ameliorated  and  brought  into  a 
condition  more  favorable  for  the  production  of  a  higher  class 
of  plants  than  formerly.  When  the  soil  has  been  thus  im- 
proved, commercial  fertilizers  may  be  tested,  not  because  the 
soil  is  deficient  in  potential  plant  food,  but  because  the  supply 
of  available  plant  food  may  be  deficient. 

One  practice  which  is  most  wasteful  and  improvident  is 
that  of  permitting  the  land  to  remain  naked  during  the  win- 
ter and  thus  allowing  it  to  be  washed  and  plant  food  wasted. 
Lands  which  are  left  naked,  that  is,  with  no  plants  growing 
upon  them,  during  the  rainy  season,  lose  more  plant  food  in 
the  drainage  water  and  by  surface  washing  than  would  be  re- 
moved by  several  crops.  Where  thorough  tillage  is  practiced 
on  crops  grown  during  the  summer,  a  large  am?)unt  of  plant 
food,  especially  nitrogen,  is  made  available  in  the  first  few 
inches  of  surface  soil.  Not  all  of  this  plant  food  is  used  by 
the  crop  growing  upon  the  land.  If,  when  the  crop  is 
removed,  the  land  is  left  bare,  this  soluble  plant  food  in  the 
surface  soil  is  washed  out  or  changed  into  a  form  which  is  less 
available.  To  prevent  these  wastes  the  soil  should,  at  all 
times  when  possible,  have  plants  growing  upon  it.  Rye  or 
wheat  may  be  sown  in  the  late  fall  after  the  regular  crop  is 
removed.  While  the  plants  may  not  make  much  growth, 
yet  they  feed  upon  the  soluble  plant  food  and  thus  prevent 
its  waste;  the  roots  permeate  the  soil  and  hold  it  in  place,  and 
when  the  land  is  plowed  in  the  spring  some  addition  is  made 
to  the  organic  matter  of  the  soil.     Seed  for  this  cover  crop 


A    FURTHER   STUDY    OF    THE    FARM.  87 

may  be  sown  without  replowiiig  the  land,  and  it  may  be 
drilled   in  or  sown  broadcast  and  harrowed  in. 

The  texture,  or  physical  condition,  of  the  soil  has  much  to 
do  with  fertility.  Not  all  fields  of  the  farm,  nor  all  parts  of 
the  same  field,  can  be  treated  alike  to  secure  the  best  results. 
A  field  of  grain  is  unsightly  as  well  as  unprofitable  where  on 
large  portions  of  the  field  there  was  failure  in  securing  a 
stand,  or  where  the  crop  is  a  partial  or  complete  failure. 
Earnest  endeavors  should  be  made  to  discover  and  remove 
the  causes  which  produce  these  conditions. 

A  study  has  been  made  of  the  means  by  which  the  moisture- 
holding  capacity  of  soils  may  be  increased,  but  an  equally 
important  subject  for  study  is  how  the  surplus  water  of  the 
soil  may  be  removed  by  some  other  means  than  by  surface 
drainage  or  evaporation.  If  the  subsoil  is  porous  and  open, 
then  it  is  probable  that  no  artificial  drains  wulL  be  required. 
But  when  there  is  an  impervious  subsoil,  or  where  owing  to 
seepage  a  soil  is  kept  in  a  water-logged  condition  for  a  con- 
siderable length  of  time,  then  the  matter  of  drainage  should 
receive  careful  study.  In  planning  for  the  removal  of  the  sur- 
[)lus  water  it  is  probable  that  a  complete  system  of  drainage 
would  not  be  put  in  at  first,  but  a  complete  system  should  be 
planned  and  a  partial  system  provided  for  those  places  which 
seem  most  to  need  drainage. 

The  farm  is  not  only  a  storehouse  for  plant  food,  but  it  is  a 
factory  where,  through  action  of  sunlight,  moisture,  and 
warmth,  the  raw  material,  plant  food,  is  changed  into  a  more 
or  less  finished  product  according  to  the  system  of  farming 
l)ursued.  In  deciding  what  class  of  products  shall  be  manu- 
factured it  is  absolutely  necessary  for  success  that  the  farmer 
make  a  study  of  himself.  If  he  loves  the  form  and  lines  of 
the  Jersey  cow  and  takes  delight  in  her  beauty,  then  it  would 
be  manifestly  improper  for  that  man  to  breed  Holsteins.  He 
should  breed  that  class  of  animals  which  he  loves  and  will 
take  pride  in  and  care  for.  If  a  farmer  takes  delight  in  grow- 
ing potatoes  and  it  gives  him  ])leasure  to  see  their  luxuriant 
foliage,  and  to  care  for  them  and  keep  them  free  from  blight 
and  insects,  then  he  should  make  a  specialty  of  potatoes,  pro- 


88  THE    FARMER  S    EDUCATION. 

viding  his  soil  is  adapted  to  the  crop.  There  should  of  course 
always  be  adaptation  of  crop  to  the  soil  upon  which  it  is  to  be 
grown.  Once  it  is  decided  for  what  crops  the  soil  is  adapted 
and  what  crops  or  products  it  will  give  pleasure  to  the  farmer 
to  produce,  then  the  energy  of  the  farmer  should  be  concen- 
trated in  mastering  all  the  details  which  enter  into  their  })ro- 
duction.  Success  on  the  farm  can  not  be  obtained  by  fluctu- 
ating fi'om  year  to  year  between  various  products.  Some 
fixed  policy  should  be  decided  upon,  and  then  that  policy 
should  be  adhered  to  and  not  thrown  up  because  of  one  sea- 
son's failure.  By  this  we  do  not  mean  that  one's  energy  should 
be  all  concentrated  upon  one  crop,  but  whatever  crops  are 
decided  upon  as  specialties  they  should  not  be  changed  from 
year  to  year,  because  permanent  success  with  a  crop  depends 
upon  mastering  all  the  details  which  enter  into  the  growth 
and  sale  of  that  crop.  There  is  almost  no  farm  product  for 
which  there  is  not  a  market;  but  it  may  be  safely  said  thiit 
there  is  always  a  greater  margin  of  profit  on  those  products 
which  require  in  their  production  a  maximum  of  brains.  The 
location  of  the  farm  with  reference  to  the  market  will,  in  n 
large  degree,  determine  the  class  of  products  to  be  produced 
Those  farms  far  from  market,  where  there  is  necessitated  a 
long  haul,  or  a  long  shipment,  should  produce  as  nearly  as 
possible  a  finished  and  concentrated  product.  Instead  of  sell- 
ing the  bulky  hay  it  should  be  manufactured  into  a  finished 
product,  as  beef,  or  mutton,  or  butter  and  cheese.  Those  farms 
within  easy  access  of  the  market  can  better  afford  to  sell  the 
coarser  products.  They  are  in  closer  touch  with  the  con- 
sunu-r;  fluctuations  of  the  market  can  be  studied,  and  advan- 
tage taken  of  any  temporary  rise  in  prices,  while  the  farmer 
at  a  distance  must  largely  produce  those  articles  for  which 
there  is  a  staple  demand  or  for  which  he  has  created  a  special 
demand. 

In  brief,  a  study  of  the  farm  should  begin  with  the  adap- 
tation of  the  farm  for  a  home,  and  as  a  means  of  securing  a 
competence.  If  it  is  not  capable  of  meeting  both  these  require- 
ments, then  some  other  faini  or  some  other  occupation  than 
that  of  a  farmer  should  be  selected. 


BOOK  THIRD. 

The  Farmer's  Relationships, 


CHAPTER    I. 

THE    FARMER   AND    HIS    FAMILY. 

THE  moral  and  emotional  features  of  tlie  family  relation 
so  greatly  overweigli,  in  most  minds,  its  economic 
importance  that  it  may  at  first  seem  out  of  place  to 
consider  it  in  a  volume  avowedly  devoted  to  business  affairs, 
and  yet  the  manner  of  discharging  even  these  sacred  obliga- 
tions has  its  bearing  on  the  family  prosperity.  Obligations  of 
business  duty,  as  well  as  of  affection,  exist  between  husband 
and  wife  and  parent  and  child.  These  business  obligations 
are  not  one-sided,  but  mutual. 

The  farmer's  family  consists  of  his  wife,  his  children,  and 
his  employees.  Of  these,  more  important  than  all  the  rest  is 
the  wife.  If  there  is  or  ever  could  be  about  a  farm  a  being 
who  is  entitled  to  the  utmost  consideration  and  respect,  it  is 
the  one  who  feeds  the  family  and  bears  the  children.  If  any 
one  earns  an  easy  time,  or  the  easiest  time  possible,  it  is 
certainly  she.  And  yet  I  do  not  believe  that  there  is  in  all 
America  a  farmer  so  distressed  as  to  willingly  change  places 
with  his  wife. 

The  husband,  to  a  great  extent,  does  what  he  will;  the 
wife,  to  a  great  extent,  does  what  she  must.  Tlie  woman, 
when  she  marries,  voluntarily  puts  herself  in  the  power  of  one 
who  is  stronger  than  herself.  If  that  power  is  exerted  to 
protect  and  comfort,  she  is  happy;  if  it  is  employed  to  oppress, 

(89) 


90  THE  farmer's  relationships. 

she  is  miserable.  It  makes  little  difference  whether  the  intent 
be  to  oppress.  If  the  result  is  oppression,  she  is  unhappy. 
The  wife  thinks  continually  of  the  happiness  of  her  husband 
and  family.  She  constantly  sacrifices  herself  for  their  comfort 
and  welfare.  If  she  is  repaid  by  the  little  attentions  she 
received  before  marriage  it  is  all  she  asks.  She  seldom  gets 
them,  and  that  this  is  true  is  evidence  of  the  meanness  of 
men.  Work  does  not  hurt  a  health}''  woman  any  more  than 
it  does  a  healthy  man,  and  the  girl  who  becomes  a  farmer's 
wife  expects  to  work,  but  she  ought  not  to  work  more  hours 
than  the  man  does,  nor  to  work  at  all  when  unable  to  do  so. 
She  does  both.  There  are  very  few  farmers'  wives  who  do  not 
work  hard  for  days  when  their  husbands,  feeling  no  more 
able,  would  lie  on  the  bed  and  be  waited  on.  Doubtless  some 
of  this  is  inevitable.  Most  of  it  is  not.  The  farmer  could 
make  his  wife's  life  easier  if  he  would,  and  he  would  if  he 
were  less  selfish.  He  thinks  less  of  his  wife  than  of  his 
stomach,  and  in  this  American  farmers  are  the  worst  offenders 
in  the  world.  We  commiserate  the  lot  of  the  European  wives 
who  work  in  the  field.  They  probably  have  an  easier  life 
tlian  the  American  wives  who  kill  themselves  cooking  and 
washing  dishes  while  their  husbands  sit  by  and  smoke. 

To  most  men  women  are  incomprehensible.  They  love 
flowers  and  ribbons,  and  all  things  that  are  beautiful.  They 
not  only  love  them,  but  must  have  them  or  be  unhappy. 
They  like  a  friendly  chat  with  a  neighbor,  and  a  horse  to 
go  and  visit.  They  enjoy  social  intercourse  to  relieve  the 
monotony  of  their  lives.  The  farmer  may  care  for  none  of 
these  things.  His  work  is  not  monotonous  and  his  business 
takes  him  about.  He  comes  home  to  rest  while  his  wife  must 
go  away  to  rest.  These  things  she  pays  for,  and  if  she  does 
not  get  them  she  is  cheated  and  yet  can  not  help  herself 
The  wife  studies  her  husband  and  knows  him  through  and 
through.  No  weakness  of  his  is  hid  from  her,  and  since  the 
man  will  not  pay  his  debt  to  her  in  a  manly  way,  she  plays 
upon  his  weakness  to  get  her  dues  by  indirection.  Watching 
her  time  she  cooks  a  good  dinner  and  then  asks  for  help  to 
make  her  flower  garden.     The  rest  obtained  by  going  away 


THE    FARMER    AND    Ills    FAMILY.  91 

from  home,  and  the  pleasure  of  a  flower  garden,  and  neatness 
about  the  liouse,  are  part  of  the  necessary  cost  of  carrying  on 
any  farm.  These  and  similar  things  are  the  wife's  due.  Tlie 
man  owes  them.  If  he  does  not  pay,  he  defaults,  simply 
because  his  wife  is  helpless.  She  gives  her  love  and  her  life. 
She  is  entitled  to  affection  in  return,  shown  daily  in  the  little 
things  that  make  up  her  life.  And  how  she  repays  such 
things!  The  wife  will  work  herself  to  death  for  a  kind  word, 
and  deem  it  happiness.  As  a  pure  matter  of  business  it  is  as 
profitable  to  treat  a  wife  well  as  it  is  to  feed  a  steer  well. 

Men  are  accustomed  to  assume  that  they  alone  provide 
the  family  income.  This  is  not  true.  In  ffirmers'  families 
it  is  true  that  the  man  usually  provides  the  gross  income,  but 
the  net  income  is  what  counts,  and  for  this  the  woman  is 
in  great  part  responsible.  Money  sav^ed  by  the  wife  is  as 
much  a  contribution  to  family  support  as  money  earned  by 
the  husband.  The  wife's  contribution  to  the  partnership  has 
upon  the  average  as  much  pecuniary  value  as  that  of  the 
man.  In  some  cases  it  is  more,  and  in  other  cases  less.  The 
man,  being  stronger,  is  not  inclined  to  recognize  this.  The 
woman  is  entitled  to  control  one-half  the  net  family  income, 
and  to  the  independent  use  of  what  she  needs  for  enjoyment. 
She  has  the  same  right  as  her  partner  to  take  partnership 
funds  for  individual  use. 

If  a  man  has  children  he  has  a  certain  duty  towards  tiiem. 
If  unwilling  to  discharge  that  duty  he  should  not  marry.  If 
he  has  a  family  and  neglects  his  duty  he  is  as  much  a 
defaulter  as  if  he  fails  to  pay  money  that  is  due.  I  have  no 
occasion  or  intent  to  discu.ss  the  duties  of  parents  to  children 
except  in  so  far  as  they  are  peculiar  to  the  condition  of  the 
farmer. 

The  farmer's  children  are  more  subject  to  illusions  than 
those  brought  up  in  towns  and  cities,  because  they  are  brought 
less  in  contact  with  reality.  Their  imagination  is  stimulated 
by  the  unwholesome  fiction  which  constitutes  much  of  what 
is  called  literature  in  country  homes,  and  their  tendency  is 
to  acquire  a  distaste  for  country  life  and  a  longing  for  the 
imaginary  ease  of  the  city.     This  tendency  is  increased  by  the 


92  THE  farmer's  relationships. 

unquestionably  authentic  statements  of  remarkable  successes 
achieved  by  American  country  boys  who,  with  no  special 
training  for  anything,  found  their  way  to  the  city  and  pros- 
pered. 

It  is  the  duty  of  the  fanner  to  impress  his  children  with 
tlie  truth  that  the  day  when  such  things  are  possible  to  the 
ordinary  boy  is  forever  gone  in  this  country.  Ninety-nine 
out  of  every  hundred  who  hereafter  may  try  this  route  to 
success  will  fail.  Every  avenue  to  employment  in  American 
cities  is  now  choked  as  completely  as  it  has  been  for  centuries 
in  Europe.  In  every  mercantile  or  manufacturing  establish- 
ment those  already  employed  are  constantly  on  the  watch  for 
every  opening  in  behalf  of  their  own  dependents  and  friends. 
Tliere  are  twenty  applicants  for  every  place.  It  is  also  an  age 
of  specialization.  The  boy  wanted  now,  when  any  is  wanted, 
is  not  one  who  is  willing  to  do  anything,  but  one  who  knows 
how  to  do  something.  The  farmer's  duty,  therefore,  is  to 
train  his  children  to  be  either  farmers  or  something  else. 
Some  trade  or  profession  they  must  have,  or  they  will  be 
terribly  handicapped  in  the  race  of  life.  City  boys  themselves 
understand  this.     Country  boys  do  not  realize  it. 

There  are  many  tilings  which  are  desirable  in  life,  but 
only  food,  shelter,  and  clothing  are  essential.  These  are  easiest 
come  by  in  the  country,  and  country  life  will  therefore  always 
be  easier  than  city  life.  The  boys  do  not  realize  this,  and  it 
is  a  farmer's  duty  to  seek  to  convince  them.  At  the  same 
time  the  city  will  always  be  recruited  from  the  country,  and 
of  those  who  go  to  the  city  a  certain  portion  will  succeed. 

Bat  the  best  evidence  of  probable  success  in  city  life  is 
unusual  effectiveness  on  the  farm.  The  boy  who  is  most 
helpful  at  home  will  be  most  likely  to  be  successful  elsewhere. 
'I'he  shiftless  boy  may  be  a  genius  but  is  probably  a  defective. 
The  boys  and  girls,  therefore,  should  be  trained  to  work. 
'Hie  old-fashioned  doctrine  that  boys  were  bound  to  work 
for  their  fathers  until  twenty-one  years  of  age  is  thoroughly 
wholesome  and  useful.  The  children  have  duties  to  parents 
as  well  as  parents  to  children,  and  children  ought  not  to 
expect  what  their  parents  are  evidently  unable  to  bestow. 


THE    FARMER    AXD    HIS    FAMILY.  93 

A  man's  duty  to  his  children  is  measured  by  his  ability. 
He  is  not  bound  to  impoverish  himself,  or  to  burden  his 
declining  years  with  debt,  in  order  to  make  life  easy  for  his 
children.  The  boy  who  attains  influential  position  in  life 
will  do  so  by  the  qualities  inherent  in  himself.  All  his 
father  can  do  is  to  aid  in  preparing  him  for  a  useful  career. 
When  he  does  this  to  the  extent  of  his  ability  lie  has  done  his 
duty.  In  so  far  as  he  fails  to  do  wdiat  in  reason  he  can,  he 
fails  of  his  duty.  American  fathers  seldom  fail  in  their  desire 
or  effort  to  do  well  by  their  children,  but  often  do  fail  in  good 
judgment.  It  is  the  nature  of  children  to  play,  and  it  is 
proper  that  they  should  do  so,  but  it  is  also  essential  that  they 
acquire  habits  of  work,  and  not  only  of  work  but  of  responsi- 
bility. The  farmer  has  in  this  respect  great  advantage  over  the 
resident  of  the  city.  He  always  has  light  work  for  which  he 
can  make  his  children  responsible.  This  should  be  begun  at 
an  early  age  and  increased  as  the  boy  grows  older,  until,  after 
fifteen  years  of  age,  the  greater  part  of  his  time,  when  not  in 
school,  should  be  devoted  to  work.  It  is  by  work  only  that  the 
habit  of  work  can  be  acquired,  and  only  by  exercising  resj)on- 
sibility  can  faithfulness  and  judgment  be  tested.  When  the 
circumstances  of  the  parents  permit,  it  may  be  well  to  give  boys 
a  pecuniary  interest  in  wiiat  they  may  do,  but,  so  far  as  the  boy 
is  concerned,  the  value  of  it  is  mainly  in  giving  him  the  experi- 
ence of  the  difficulty  of  earning  money  and  the  importance  of 
keeping  it.  The  majority  of  children  must  look  forward  to  a 
life  of  work,  prudence,  and  small  reward.  The  farmer's  son 
who  remains  on  the  farm  may  with  reason  look  forward  to  a 
life  of  independence — working  on  his  own  land.  Not  one  in 
a  hundred  of  those  who  drift  off  to  cities  can  possibly  achieve 
anything  but  a  subordinate  position  in  which  he  must  do  the 
will  of  another  so  long  as  he  lives.  The  farmer  owes  to  the 
son  the  duty  of  making  him  understand  this.  Neither  is  a 
modest  life  an  unhappy  life. 

In  the  matter  of  education  a  common-school  education  is 
due  to  all  farmers'  children,  and  they  all  get  it.  Additional 
education  is  good  if  it  is  of  the  right  kind.  Indeed,  knowledge 
of  all  sorts  tends  to  broaden  the  boy  out,  but  I  am  one  of 


94  THE    FARMER  H    RELATIONSHIPS, 

those  who  believe  that  for  the  boy  who  expects  to  make  his 
own  way  by  his  own  work,  the  quicker  he  gets  to  learning 
what  he  will  directly  make  use  of,  the  better.  So,  after  leav- 
ing the  common  school,  the  special  agricultural  or  trade  school 
seems  to  me  the  most  desirable. 

Aside  from  the  common  school  the  best  education  which 
farmers'  children  can  have  is  good  books.  Of  these,  good 
biographies  of  successful  men  are  undoubtedly  the  best.  They 
supply  the  consecutive  "story"  which  the  young  mind  craves, 
and  incidentally  convey  useful  information.  The  daily  paper 
in  the  farmer's  home  is  a  nuisance.  Nine-tenths  of  what  it 
contains  is  of  no  value  to  anybody,  and  a  great  part  of  it  is 
positively  injurious.  Few  young  people  take  kindly  to  books 
of  a  purely  instructive  character,  but  those  who  do  should  be 
supplied  with  them.  If  there  are  signs  of  an  especial  bent  to- 
wards any  useful  occupation,  it  should  be  encouraged,  whether 
in  boys  or  girls.  The  city  youths  have  a  great  advantage  over 
those  of  the  country  in  the  great  libraries  to  which  they  have 
access.  This  deficiency  of  country  life  it  is  the  duty  of  the 
farmer  to  supply  to  the  best  of  his  ability. 

In  short,  the  duty  of  the  father  as  a  farmer  seems  to  me  to 
be  to  get  out  of  his  children's  heads  the  notion  that  city  life 
is  in  any  way  easier  than  country  life;  to  train  them  to  habits  of 
w^ork  and  responsibility  not  beyond  their  strength  and  their 
years;  and  to  the  best  of  his  ability  to  supply  them  with  the 
means  of  getting  useful  information.  When  this  is  done,  if 
there  is  anything  in  them  of  value  it  will  develop  itself.  If 
there  is  not,  that  is  the  end  of  it.  The  father  has  done  his 
duty. 

The  farmers'  employees  will  be  mostly  young  men. 
Toward  them  his  duty  is  to  make  their  lives  such  as  he  would 
be  willing  that  his  own  son  should  live.  The  old  custom  of 
farmers'  sons  "  hiring  out"  to  neighboring  farmers  seems  to  be 
gradually  dying  out.  It  was  a  good  custom,  and  yet  nothing 
that  I  can  say  is  likely  to  revive  it.  Farmers'  sons  seem 
inclined  to  drift  off  to  work  among  strangers  and  to  spend  what 
they  earn  in  hunting  for  new  jobs.  In  the  end  they  tend  to 
degenerate  into  the  irresponsible  and  transient  laboring  class 


THE    FARMER    AND    HIS    FAMILY.  95 

with  wliich  farmers  and  employers  of  unskilled  labor  have 
to  deal.  Away  from  the  restraints  of  home  and  family 
influence,  their  tendency  is  downward.  "What  each  farmer 
can  do  to  check  this,  is  to  employ  farmers'  sons  of  his  ac- 
quaintance so  far  as  he  can  do  so,  and  whoever  he  employs, 
to  treat  them  with  social  consideration.  The  faithful  young 
man  who  works  on  a  farm  is  as  good  a  man  as  the  farmer 
he  works  for.  If  he  is  not  treated  as  such  he  will  be  dis- 
contented. There  is  no  social  distinction  between  the  farmer 
and  the  farm  hand.  If  one  is  artificially  set  up,  desirable 
men  will  be  driven  out  of  the  business,  and  the  most  promis- 
ing opening  for  the  son  of  the  farmer  himself  be  cut  off. 


CHAPTER    11. 

THE    FARMER   AXD    HIS    FELLOWS. 

THE  fault  with  farm  life  is  the  lack  of  social  intercourse. 
Where  farms  are  large  this  is  hard  to  overcome.  The 
natural  time  for  social  intercourse  is  the  evening,  but 
when  the  farmer,  his  wife,  and  his  team  are  tired,  and  tlie 
time  for  rising  five  o'clock  the  next  morning,  there  is  not 
much  inclination  to  start  out.  These  conditions  must  be 
overcome.  Man  is  a  social  animal.  He  must  mingle  with 
his  fellows  or  deteriorate.  Where  farms  are  small  the  diffi- 
culty is  less  serious.  Modern  improvements  are  doing  much 
for  the  farmer  in  this  respect.  The  country  roads  are  improv- 
ing and  the  trolley  and  the  bicycle  are  never  tired. 

It  seems  to  me  that  farmers  must  systematically  attend  to 
these  social  duties  if  they  are  to  be  happy.  I  am  not  speaking 
of  social  intercourse  for  ''improvement"  but  for  recreation. 
If  circumstances  forbid  it  of  evenings,  the  time  must  be  taken 
from  the  day.  Tlie  American  farmer  is  among  the  least  social 
of  men.  Such  social  gatherings  as  occur  are  mostly  left  to 
the  young  people,  who,  unrestrained  by  the  presence  of  their 
elders,  are  not  always  decorous.  The  country  "ball,"  held 
upon  holidays  in  some  public  hall,  and  open  to  all  comers 
who  will  pay  the  fee,  is  not  always  a  desirable  place. 

This  rather  questionable  mode  of  recreation  has  grown  up 
as  the  result  of  rural  conditions  in  this  country,  and  can  be 
exterminated  only  by  a  change  of  those  conditions.  Young 
people  will  certainly  meet  for  social  enjoyment,  and  if  the 
way  is  made  difficult  to  rational  methods,  they  will  take  other 
ways.  The  amusements  which  from  time  immemorial  have 
had  chief  place  among  the  people  of  all  nations,  have  been 
the  card  table  for  the  elders  and  the  dance  for  the  young.  I 
am  not  aware  that  either-of  these  amusements  was  ever  con- 
sidered questionable  until  the  rise  of  the  great  Puritan  move- 
(96) 


THE    FARMER   AND   HTS    FELLOWS.  97 

ment  in  the  seventeenth  century,  wliich,  mainly  through  the 
New  EngUind  settlement,  has  left  its  impress  on  all  America. 
At  the  present  time  large  numbers  of  the  most  excellent 
})eo])le  we  have  are  profoundly  convinced  of  the  essential  im- 
morality both  of  card  playing  and  dancing.  Some  churches 
make  it  a  matter  of  discipline;  some  wink  at  it,  and  some  see 
nothing  wrong  in  it. 

On  the  other  hand,  many  estimable  people,  doubtless  com- 
prising the  majority  of  the  community,  believe  dancing  in 
itself  to  be  an  agreeable  and  innocent  amusement,  and  that 
the  evil  consists  in  the  promiscuous  entertainments,  conducted 
in  public  places  and  open  to  all,  which  are  common  in  rural 
districts.  As  to  '"'card  playing"  they  claim  that  it  is  an 
absolutely  innocent  recreation,  which  has  proved  its  accepta- 
bility for  ages,  and  in  all  countries,  and  deny  absolutely  that 
it  has  any  tendency  whatever  to  lead  to  "gambling,"  or  that 
in  fact  it  ever  does  so  lead.  It  may  not  seem  clear  to  all  what 
this  has  to  do  with  the  economic  relations  of  the  farmer  to 
his  fellows,  but  the  fact  is  that  in  many  rural  districts  this 
question  of  dancing  and  card  playing  lies  at  the  root  of  rural 
(iiscontent.  It  did  so  in  the  neighborhood  where  I  was 
brought  up.  The  people  of  most  sterling  worth  set  their 
faces  strongly  against  these  amusements,  which  the  rougher 
element  freely  indulged  in.  The  more  headstrong  of  the 
youth  of  the  better  families  tended  to  break  loose  from  home 
restraints  and  associate  themselves  with  the  rough  element,  to 
the  unquestioned  deterioration  of  their  morals. 

Youth  craves  amusement  and  will  have  it.  Age  really 
requires  it  more  than  youth.  The  trouble  with  rural  society 
is  not  the  modesty  of  its  pecuniary  rewards,  but  the  grinding, 
cheerless  habit  of  life,  which,  by  the  way,  is  more  marked  in 
the  American  farmers  than  in  any  other  people  in  the  world. 
The  youth  do  not  drift  to  the  cities  so  much  with  the  idea  of 
making  more  money  as  of  having  a  better  time.  The  remedy 
for  much  of  the  farmers' discontent  is  more  abundant  social 
intercourse,  in  which  it  is  extremely  desirable  that  parents 
and  children  should  participate  together. 

The  difficulties  in  the  way  of  this  seem  almost  insurmount- 
7 


98  THE  farmer's  relationships. 

able.  Farmers'  houses  are  not  usually  built  to  accommodate 
large  companies.  This  of  itself  often  compels  the  resort  to  the 
objectionable  public  hall.  It  is  always  possible,  however,  for 
heads  of  families  to  unite  to  engage  such  halls,  control  the 
company  invited,  and  b}^  their  j^resence  exercise  all  necessary 
restraint.  When  gatherings  are  held  at  farmhouses,  the 
labo"  of  preparation,  and,  worse  still,  of  clearing  away  after, 
often  falls  almost  entirely  upon  the  ah^eady  overworked 
womei.  of  the  family.  There  is  often,  also,  an  unfortunate 
strife  to  outdo  each  other,  which  adds  greatly  to  the  labor, 
and  bears  harder  on  the  weaker. 

No  one  can  settle  these  things  but  tlie  farmers  themselves 
and  their  families,  in  the  light  of  their  sturdy  common  sense, 
and  their  regard  for  themselves  and  their  youth.  But  one 
thing  is  sure,  if  rural  conditions  are  to  improve,  the  begin- 
ning must  be  made  in  its  social  features.  The  American 
farmer  does  not  need  to  work  harder  but  to  play  more.  He 
must  mingle  with  his  fellows  for  the  mere  enjoyment  of  it. 
And  when  gatherings  are  held,  they  must  be  so  managed  that 
a  good  time  is  assured.  Grange  meetings  are  good,  but  the 
majority  of  farmers  are  not  grangers,  nor  can  any  formal 
organized  meeting  take  the  place  of  the  unrestricted  freedom 
of  intercourse  at  the  home. 

And  such  gatherings  do  not  need  promotion  in  any 
organized  way.  Any  family  can  begin  a  round  of  "  visits  "  to 
other  families,  which  will  be  quite  certainly  returned  in  due 
time  Or  the  more  formal  course  can  be  taken  of  issuing 
invitations  for  an  afternoon  and  evening,  or  for  the  evening 
alone.  There  would  be  more  of  this  if  the  women  of  rural 
households  would  content  themselves  with  such  preparations 
as  are  within  their  strength.  Perhaps  this  is  not  possible,  the 
vice  of  "showing  off"  being  apparently  inseparable  from  the 
make-up  of  a  good  housewife.  But  in  some  way  tlie  social 
conditions  of  rural  life  must  improve  if  fathers  and  mothers 
are  to  be  contented,  or  the  brighter  youtli  to  be  retained  there. 

I  do  not  think  it  an  ignoble  view  of  life  to  consider  its 
main  end  rational  enjoyment,  for  the  higliest  pleasure  unques- 
tionably comes   from    labor   profitably  directed,   interspersed 


VHE    FARMER    AND    HIS    FELLOWS.  99 

with  suitable  recreation,  and  accompanied  by  the  discharge  of 
civic,  social,  and  religious  duties.  The  importance  of  the 
social  side  comes  from  the  fact  that  through  that  we  in  a  great 
measure  shape  the  lives  of  our  youth.  Recreation  they  will 
have,  and  if  they  deteriorate  it  will  almost  certainly  be 
through  companionships  formed  in  pursuit  of  recreation  in 
which  parents  do  not  participate.  The  economic  importance 
of  this  chapter  grows  out  of  the  danger  that  under  present 
social  conditions  the  drain  of  vigor  from  the  farm  to  the  city 
will  be  greater  than  the  farming  class  can  endure  without 
impairing  its  power  of  survival.  The  weaker  residue  left 
may  not  be  able  to  sustain  themselves  in  competition  with 
other  classes.  As  the  lack  of  social  enjoyment  on  the  farm  is 
unquestionably  the  main  factor  in  driving  boys  away  from 
the  farm,  it  is  best  to  frankly  recognize  the  fact.  Rational 
recreation  is  an  economic  factor  of  great  power. 


CHAPTER    III. 

THE    FARMER    AND    HIS    COMPETITORS. 

IF,  in  a  certain  town  upon  a  certain  day,  two  men  need  loads 
of  hay  and  two  farmers  are  in  town  with  hay  to  sell,  the 
demand  is  exactly  equal  to  the  supply.  Each  can  buy 
what  he  needs  or  sell  what  he  has  to  spare.  If  the  hay  in 
the  two  loads  is  of  the  same  quality  it  would  seem  that  the 
element  of  competition  hardly  entered  into  the  transaction. 
As  a  matter  of  fact,  it  is  operating  as  strongly  as  ever.  Tlie 
competition  of  sellers  prevents  a  rise  in  price  and  that  of  the 
buyers  a  fall.  It  is  also  evidently  true  that  neither  buyers  nor 
sellers  would  probably  know  that  the  market  was  in  exact 
equilibrium,  and  consequently  would  act  under  the  full  influ- 
ence of  the  competitive  feeling. 

Aside  from  the  competition  of  these  buyers  and  sellers  in 
reference  to  these  loads  of  liay,  in  any  town  there  is  likely  to 
be  grain  and  straw  for  sale,  which  may  entirely  take  the  place 
of  hay,  and  would  do  so  if  the  price  of  the  latter  were  placed 
too  high.  If,  instead  of  considering  the  competition  merely 
with  reference  to  tlie  business  of  one  day,  We  consider  it  in  the 
long  run,  as  in  fact  it  always  operates,  we  see  that  timothy 
hay,  for  example,  competes  in  the  market  with  all  other  forms 
of  forage  and  grain  which  will  serve  for  stock  food.  It  is  the 
same  with  food  for  human  beings.  All  food  materials  compete 
in  the  market  with  all  other  food  materials.  So  also  the 
fibers  suitable  for  clothing  compete  among  themselves.  When 
wool  is  extremely  high  as  compared  with  cotton,  more  of  the 
latter  will  be  used  in  cloths.  As  the  business  of  the  farmer  is 
mainly  the  production  of  raw  material  for  clothing  and  for 
food  for  men  and  animals,  all  farmers  are  in  competition  with 
all  other  farmers  for  the  sale  of  their  products.  The  wheat 
farmer  does  not  merely  compete  with  other  wheat  or  even 
with  other  breadstuffs,  but  with  all  other  food  products. 

(100) 


THE    FARMER    AND    HI^^    COMPETITORS.  101 

But  there  is  another  way  of  looking  at  this  matter.  The 
combined  kibor  of  mankind  for  a  given  time,  together  with 
the  use  of  the  accumulations  of  ages,  results  in  the  power  to 
obtain  a  certain  number  of  satisfactions  which  those  belonging 
to  the  race  may  enjoy  during  that  time  or  reserve  for  future 
enjoyment.  Each  one  of  us  is  struggling  to  obtain  for  himself 
in  each  year  the  largest  possible  portion  of  this  common  stock 
of  satisfactions.*  In  common  language  we  do  not  use  the 
term  "satisfactions,"  but  "money,"  wliich,  so  far  as  they  are 
objects  of  economic  thought,  will  procure  them.  What,  how- 
ever, we  really  seek  is  the  satisfaction  wliiuh  ^Wt  obtajn  by  the 
use  of  money.  -'         -        .  ,.     .  . 

When  a  farmer  who  has  hay  to  spaiG'  deji-s  witli-ono  wiio 
desires  to  buy  hay,  we  do  not  usually  think  of  the  temporary 
relation  as  one  of  competition,  but  as  an  exchange  of  satisfac- 
tions for  the  mutual  benefit  of  both,  as  in  fact  it  usually  is;  but 
the  farmer  desires  to  get  the  highest  price  possible  for  his  hay, 
with  no  thought  for  the  profit  which  the  buyer  may  obtain  for 
its  use,  while  the  buyer  desires  to  purchase  as  cheaply  as 
possible  without  regard  to  what  it  may  have  cost  the  seller. 
They  are  competing  w'ith  each  other  for  the  possession  of 
money. 

The  economic  transactions  of  modern  times  have  become 
so  inextricably  interwoven  with  each  other  that  they  can  by 
no  possibility  be  separated,  and  the  result  is  that  all  men  are 
competitors  of  all  other  men.  This  competition  which  per- 
vades all  nature  is  called  the  struggle  for  existence.  Its  only 
limit  is  that  imposed  by  affection,  which  leads  men  to  forego 
personal  satisfactions  for  the  sake  of  their  families  and  friends, 
and  by  an  altruisticf  feeling  which  impels  a  comparatively  few 
men  and  many  more  women  to  prefer  the  general  welfare  to 
their  personal  gain.  Economic  science  recognizes  the  exist- 
ence of  this  influence  but  does  not  deal  w-ith  it.  It  assumes 
competition  to  continue  unhampered. 

*"  Satisfaction  "  is  a  term  used  in  economic  science  to  denote  anything 
which  is  the  object  of  human  desire,  even  though  its  use  may  be  actually 
injurious. 

f  Altruism  means  "  regard  for  others." 


102  THE  farmer's  relationships. 

It  is  not  necessary  to  my  purpose  to  consider  the  farmer  as 
a  man  competing  with  all  other  men,  but  only  in  the  narrower 
view  of  a  farmer  competing  with  all  other  farmers.  We  shall 
find  this  wide  enough. 

Among  an  ideal  race  of  beings  the  object  of  each  party  to 
an  exchange  of  commodities  would  be  to  get  for  himself  and 
for  another  exactly  what  would  fairly  pay  each  for  the  neces- 
sary cost  of  acquirement.  As  human  beings  are  now  consti- 
tuted, however,  it  would  be  a  waste  of  time,  from  a  merely 
economic  standpoint,  to  discuss  exchanges  on  the  assumption 
that  ^suchVinoilves  will  control  their  character.  Any  such 
discussion  ,beJonga  to  the  science  of  ethics,  which  deals  with 
human  affairs  frbm  the  standpoint  of  what  ought  to  be.  Eco- 
nomics deals  with  facts  as  they  are,  and  therefore  necessarily 
assumes  universal  competition. 

The  relation  of  the  farmer  to  his  competitors  is,  then,  the 
relation  of  one  struggling  with  another,  not  necessarily  in  an 
unfriendly  spirit,  but  with  intent  to  beat  if  possible,  regardless 
of  the  feelings  or  interests  of  the  competitor.  In  such  struggles 
the  fundamental  requisite  for  success  is  to  keep  watch  of  the 
opponent.  An  athlete  who  should  pay  no  attention  to  the 
actions  of  his  opponent  could  only  hope  to  win  by  means  of 
very  great  superiority  of  strength.  This  principle  of  watchful- 
Jiess  as  a  condition  of  success  is  universal,  applying  equally  to 
physical,  intellectual,  and  business  contests. 

It  is  in  neglect  of  this  principle  that  farmers  fail  most 
completely.  Very  few  farmers  know  what  their  competitors 
are  doing.  In  this  respect  they  are  immeasurably  inferior  to 
the  mercantile  and  manufacturing  classes.  The  cause  of  this 
is  not  altogether  intellectual  inferiority,  although  it  is  true 
that  the  most  alert  and  vigorous  men  tend  to  engage  in  other 
occupations  than  farming,  but  it  is  also  true  that  men  of  no 
great  mental  endowments  may  and  do  succeed  fairly  well  in 
business.  Merchants  and  manufacturers  watch  their  compet- 
itors more  closely  than  farmers  because  they  are  compelled 
to.  Competition  is  such  that  failure  to  watch  is  ruin.  When 
a  manufacturer  finds  a  competitor  persistently  meeting  him 
with  goods  of  equal  quality  but  lower  price,  he  knows  at  once 


THE    FARMER    AND    HIS    (COMPETITORS.  103 

tliat  the  competitor  is  in  financial  difficulty  and  striving  to 
realize,  regardless  of  cost,  or  that  he  is  producing  cheaper 
than  himself,  the  latter  involving  his  own  ruin  unless  he  can 
himself  reduce  cost.  He  is,  therefore,  constantly  on  the  alert 
to  discover  the  details  of  the  manufacturing  and  business 
methods  of  all  his  competitors  in  order  to  promptly  avail 
himself  of  any  improvement  which  any  one  (5f  them  may 
make.  He  is  able  to  do  this  much  easier  than  the  farmer, 
because  he  is  himself,  through  his  agents,  the  year  round,  in 
close  competition  in  all  markets,  and  his  place  of  business  will 
be  in  some  populous  center  of  intelligence.  The  majority  of 
farmers  live  in  a  rather  isolated  way,  do  not  mingle  freely 
with  well-informed  business  men,  and  make  their  principal 
sales  of  produce  but  once  a  year,  and  they  are,  therefore^ 
greatly  handicapped  in  such  efforts  as  they  do  make  to  inform 
themselves  in  regard  to  markets  and  competition.  Their 
main  reliance  is  the  columns  of  the  daily  and  agricultural 
press,  which  are  of  very  little  value  except  as  to  conditions 
affecting  a  few  staple  crops,  such  as  cotton,  grain,  and,  to  a  less 
extent,  tobacco  and  wool,  which  are  the  objects  of  speculation 
on  a  large  scale.  Even  as  to  these  things  the  press  obtains 
very  little  information  which  has  not  been  obtained  by  the 
trade  and  used  for  its  own  purposes,  and  to  the  disadvantage 
of  the  farmer,  before  publication.  The  journals  of  general 
circulation  do  not  obtain  this  information  in  advance  because 
it  would  cost  too  much. 

The  farmer,  also,  is  greatly  hampered  in  ascertaining  the 
cost  of  his  competitor's  products  because  such  costs  vary  so 
greatly  from  year  to  year.  It  requires  more  labor  than  most 
farmers  are  willing  to  bestow  to  ascertain  their  own  yearly 
costs  of  produce,  much  more  to  discover  the  costs  of  others; 
and  if  by  any  means  they  may  ascertain  substantially  the 
cost  of  competing  products  raised  in  some  distant  section  in  a 
given  year,  it  may  never  be  correct  for  any  other  year. 

The  fact  is  it  is  far  more  difficult  for  a  farmer  to  find  out 
what  his  competitors  are  doing  than  for  merchants  or  manu- 
facturers, and  yet  it  is  equally  necessary.  The  competitors  of 
the  American  wheat  farmer  are,  first,  liis  own  neighbors,  then 


104  THE  farmer's  relationships. 

those  of  his  district  or  state,  then  those  of  other  states,  and 
finally  those  of  all  foreign  wheat-producing  countries.  The 
task  seems  hopeless  and  indeed  is  absolutely  hopeless  for  the 
individual  farmer.  The  cost  of  obtaining,  independently, 
from  original  sources,  the  facts  which  tlie  farmer  needs  to 
know  in  order  to  act  with  reasonable  intelligence  in  selling, 
would  in  any  year  be  more  than  the  value  of  the  crop  and 
the  farm  itself. 

The  only  thing  which  the  farmer  can  do  unaided,  in  this 
case,  is  to  familiarize  himself  with  the  physical  geography  of 
all  competing  districts,  the  standard  of  life  of  their  people, 
and  the  length  and  character  of  the  transportation  routes 
connecting  them  with  the  commercial  center  which  fixes  the 
world's  price  of  that  particular  commodity.  The  physical 
facts  will  largely  determine  the  size  and  character  of  the  crop. 
These  are  accessible.  The  best  cyclopedias  give  them  very 
fully.  The  standard  of  life  of  the  laboring  class  will  deter- 
mine the  relative  cost  of  the  labor  bestowed  on  the  crop.  This 
he  will  get  less  from  cyclopedias,  although  much  as  to  this 
can  be  learned  from  them,  but  more  from  good  books  of  travel, 
and  similar  publications.  The  nature  of  the  transportation, 
whether  river,  sea,  or  rail,  and  the  relative  length  of  each,  will 
enable  him  to  compare  his  situation  in  that  respect.  Such 
matters  as  national  tariffs  of  course  have  to  be  considered 
when  one  is  in  a  business,  but  should  not  be  regarded  when 
proposing  to  engage  in  one.  Tariff  protection  is  very  uncer- 
tain, as  rates  of  duty  are  constantly  changing.  The  farmer  is 
best  situated  for  competition  who  can  produce  absolutely  at 
the  least  cost. 

Considered  with  reference  to  competition  with  his  imme- 
diate neighbors,  the  farmer's  position  varies  according  to  his 
product  and  his  market.  If  producing  a  product  of  limited 
use  for  the  local  market,  and  unsalable  elsewhere — as  the 
market  gardener — he  is  in  intense  competition  with  all  neigh- 
bors engaged  in  the  same  business.  He  needs  to  observe 
the  varieties,  methods  of  culture,  and  methods  of  packing 
employed  by  all  in  order  to  make  sure  that  no  one  excels  him. 
If,  however,  he  is  engaged  in  producing  the  same  commodities 


THE    FARMER    AND    HIS    COMPETITORS.  105 

on  a  large  scale,  for  distant  shipment — truck  farming — the 
farmer  in  Florida,  for  example,  needs  specially  to  know  the 
conditions  existing  in  Mississippi,  Texas,  California,  and  other 
states  ada[)ted  to  raising  early  vegetables.  In  this  case  the 
farmer's  relation  to  his  neighbor  as  a  competitor  is  entirely 
overshadowed  by  their  greater  common  interest  in  knowing 
what  is  going  on  in  distant  competing  districts.  So  far 
from  competing  it  will  usually  pay  them  far  better  to  unite  to 
incur  the  expense  of  finding  out  what  distant  competitors  are 
doing,  and  to  deal  more  effectively  with  transportation  com- 
panies, selling  agencies,  supply  dealers,  and  others  with  whom 
they  are  all  competing  for  the  possession  of  money.  It  is 
these  conditions  which  supply  the  sound  logical  basis  for  co- 
operation, which-  will  be  fully  discussed  hereafter.  For  the 
present  I  wish  only  to  say  that  it  is  by  cooperative  effort  only 
that  any  ordinary  farmer  can  ever  expect  to  obtain  from  year 
to  year  the  accurate  detailed  information  in  regard  to  crops 
and  markets  which  he  needs  to  intelligently  meet  distant 
competitors.  Except  as  he  is  willing  and  able  to  cooperate 
with  his  few  neighboring  competitors,  he  must  usually  remain 
in  substantial  ignorance  of  the  doings  of  his  distant  and  more 
dangerous  competitors — more  dangerous  because  in  the  aggre- 
gate they  constitute  the  controlling  factors  of  the  situation, 
upon  which  any  single  district  will  usually  have  very  little 
effect. 

The  object  of  this  chapter  is  gained  if  it  has  been  made 
clear  that  the  farmer  as  a  competitor  needs  to  know  the  condi- 
tions of  all  others  in  his  industry  for  the  purpose  of  thereby 
improving  his  own  practice,  and  that  such  information  as  he 
needs  will  always  cost  money,  which  will  be  a  legitimate  and 
necessary  expense  in  his  business.  That  farmers  are  enabled 
to  live  at  all  under  their  usual  slipshod  methods  of  dealing 
with  competition  and  competitors  fully  proves  that  the  farmer's 
lot  is  far  easier  and  happier  than  that  of  other  men,  for  in  no 
other  important  occupation  would  it  be  possible  to  continue  in 
business  with  so  little  information  about  competitors. 


CHAPTER    IV. 

THE   FARMER   AND    HIS    CREDITORS. 

THE  condition  of  the  indebted  farmer  who  is  not  mort- 
gaged requires  no  special  discussion  unless  he  is  so 
deeply  indebted  that  a  mortgage  has  become  necessary, 
in  which  case  what  is  here  said  is  fully  applicable. 

A  large  number  of  our  farmers  have  mortgages  upon  their 
property,  and  of  the  mortgaged  farmers  the  majority  have 
floating  debt  in  addition,  and  the  majority  of  the  unsecured 
indebtedness  of  farmers  is  due  and  unpaid. 

Since  this  is  a  condition  which  a  multitude  of  farmers  are 
compelled  to  face,  it  is  worth  while  to  give  some  study  to  the 
business  principles  involving  the  proper  treatment  of  all 
serious  indebtedness. 

From  the  first  settlement  of  the  United  States  to  the  end  of 
the  first  third  of  the  nineteenth  century,  our  progress  was 
slow  and  uniform.  Conditions  were  rude,  land  abundant  and 
cheap,  communications  difficult,  the  rewards  of  labor  moderate, 
money  scarce.  The  temptation  to  incur  debt  was  small,  and 
while  there  are  no  available  statistics  to  disclose  the  exact 
facts,  we  may  safely  assume  that  in  the  main  serious  indebt- 
edness in  the  farming  population  was  confined  to  the  im- 
provident, who  will  always  exist  and  always  suffer  for  their 
improvidence. 

In  the  thirties,  however,  the  great  tide  of  immigration  from 
northern  Europe  began  to  show  its  force,  and  for  nearly  a  half 
century  there  was  a  great  and  continuous  influx  of  thrifty  and 
vigorous  stocks,  to  whom  our  cheap  lands,  and  at  last  our  free 
lands,  opened  the  way  to  a  vast  improvement  in  their  material 
conditions.  The  majority  of  these  immigrants  pushed  at  once 
to  the  frontier,  all  taking  more  or  less  money  with  them  for 
the  purchase  of  farms  already  opened,  or  their  support  while 
themselves  opening  new  ones.    The  farmers  of  our  own  middle 

(106) 


THE    FARMER    AND    HIS    CREDITORS,  107 

states  joined  in  the  westward  march,  their  places  to  a  certain 
extent  being  taken  by  those  farther  east. 

This  movement  had  two  important  results:  in  the  iirst 
place,  it  brought  large  sums  of  money  into  the  country  to  be 
expended  for  farms  or  land,  and,  in  the  second  place,  it  created 
a  constant  home  market  on  the  frontier  for  supplies  of  all 
kinds  to  be  used  by  families  while  opening  up  their  own 
farms.  In  addition  to  this  the  rapid  increase  of  population 
greatly  increased  the  home  market  for  all  kinds  of  manufac- 
tured goods;  the  building  and  lumber  trades  were  marvelously 
stimulated,  as  towns  and  cities  sprang  up  everywhere. 

The  result  was  a  steady  increase  in  the  value  of  land  on 
the  western  frontier  and  for  a  long  distance  to  the  east  of  it. 
Farmers  bought  the  best  of  land  for  a  dollar  and  a  quarter  an 
acre,  lived  on  it  a  few  years,  and  sold  out  at  a  large  advance. 

As  this  process  went  on  continuousl}^  for  many  years,  there 
grew  up  in  the  community  a  settled  conviction  that  the  way 
to  wealth  for  the  farmer  was  to  incur  debt  for  land.  The  more 
land  a  man  owed  for  the  faster  he  was  assumed  to  be  getting 
rich.  Whenever  an  entire  community  becomes  imbued  with 
a  speculative  disposition  of  this  kind,  and  results  regularly 
continued  for  generations  seem  to  justify  anticipations,  noth- 
ing will  cure  it  except  an  absolute  demonstration  continued 
through  many  years,  of  the  final  bursting  of  the  bubble. 
Such  a  demonstration  began  with  a  panic  in  1893,  and  will 
continue  until  rural  communities  thoroughly  learn  that  never 
again  in  this  country  is  it  likely  to  be  safe  to  incur  debt  in  the 
expectation  of  paying  any  portion  of  it  from  the  "rise  in  land." 

Agricultural  land  is  now  as  high  in  the  United  States  as  it 
ever  will  or  can  be  until  the  cheap  lands  of  other  continents 
are  settled  and  the  population  of  the  earth  so  increased  as  to 
require  its  entire  surface  for  its  sup{>ort.  A  great  portion  of 
the  indebtedness  of  the  farming  class  is  of  this  speculative 
character,  and  of  such  indebtedness  a  great  part  can  never  be 
paid.  The  early  settlers  in  a  new  country,  who  endure  the 
privations  incident  to  settlement,  and  build  the  roads,  school- 
houses,  churches,  and  other  public  improvements,  are  entitled 
to  the  natural  increase  in  the  value  of  their  holdings  which 


108  THE  farmer's  relationships. 

results  from  such  improvements,  but  in  most  of  those  sections 
of  our  country  which  are  still  sparsely  settled,  all  this  ultimate 
value  is  assumed  by  holders  to  have  accrued,  and  land  is  held 
at  prices  full  as  high  as  it  can  ever  reach  within  the  lifetime 
of  men  now  living,  and  in  many  cases  at  higher  prices.  And 
yet  it  is  a  fact  that  a  great  deal  of  the  indebtedness  of  farmers 
has  been  incurred  for  land  at  such  exorbitant  prices  that  the 
debts  can  never  be  paid  off  from  the  products  of  the  soil. 

Another  matter  which  must  be  considered  in  this  con- 
nection is  the  wonderful  growth  of  our  transportation  system, 
itself  also  largely  speculative  and  developed  almost  entirely 
by  borrowed  money.  Our  early  railroads  were  built  mainly 
by  the  proceeds  of  stock.  The  men  ,who  were  the  nom- 
inal owners  were  also,  in  fact,  the  principal  real  owners.  So 
long  as  this  was  continued,  the  increase  of  mileage  was  no  more 
than  sufficient  for  the  increase  of  traffic.  Then  it  came  to  be 
considered  that  it  was  safe  to  incur  indebtedness  for  half  the 
cost  of  the  roads.  Finally  extensive  lines  came  to  be  built 
almost  entirely  on  borrowed  money  and  extended  into  districts 
in  which  at  the  time  no  traffic  existed.  The  building  of  a 
railroad  through  a  well-settled  country  where  the  traffic  to 
support  it  already  exists,  is  a  legitimate  business  enterprise. 
To  build  a  road  into  an  unsettled  country  with  the  hope  of 
ultimately  obtaining  traffic  as  the  country  fills  up,  is  purely 
speculative.  It  may  settle  up  quickly  and  it  may  not.  If  the 
traffic  does  not  come  the  mortgages  take  the  road.  In  many 
cases  the  roads  thus  built  have  not  been  worth  nearly  the 
face  of  the  mortgage.  Farmers  are  not  the  only  people  who 
speculate  unwisely. 

But  whatever  the  ultimate  result  of  the  speculative  building 
of  railroads,  the  immediate  effect  is  always  wonderfully  stim- 
ulating to  business  along  the  line.  A  district  is  always  pros- 
perous while  borrowed  money  is  being  exi)ended  in  it  on  a 
large  scale.  The  pinch  comes  when  that  money  has  to  be 
repaid,  in  addition  to  large  disbursements  for  interest.  While 
this  building  activity  is  at  its  height,  great  efforts  are  always 
made  to  sell  land  to  farmers,  who,  carried  away  by  the  prevail- 
ing excitement,  pay  more  than  the  land  can  ever  be  worth; 


THE    FARMER    AND    HIS    CREDITORS.  109 

often,  if  not  usually,  incurring  serious  debt.  In  the  more 
sparsely-settled  portions  of  the  United  States  a  great  part  of 
the  mortgage  indebtedness  was  incurred  in  this  way,  and  of 
this  much  is  never  likely  to  be  paid.  This  is  especially  true 
of  the  semi-arid  districts. 

There  is  another  kind  of  speculative  indebtedness  among 
farmers  which  concerns  a  great  number  of  individuals, 
although  for  the  most  part  concentrated  in  comparatively 
small  and  well-defined  districts,  which  is  indebtedness  incurred 
for  developing  the  fruit  industry.  The  production  of  fruit  is, 
perhaps,  the  most  speculative  occupation  which  farmers  can 
engage  in.  No  one  who  plants  an  orchard  can  by  any  possi- 
bility know  what  will  be  the  outcome  of  his  enterprise.  He 
may  make  a  great  deal  of  money,  or  he  may  lose  every  cent 
of  his  investment,  and  that  from  causes  wholly  beyond  his 
control.  Similar  speculative  indebtedness  has  been  incurred 
in  the  development  of  dairying,  truck  farming,  and  other 
agricultural  industries  whenever  the  hope  of  selling  land  or 
supplies  has  induced  effort  to  create  undue  expectations  of 
profit  from  special  agricultural  operations. 

The  foregoing  brief  review  of  the  causes  of  speculative 
indebtedness  among  farmers  is  given  for  the  purpose  of 
making  clear  to  all  wdio  are  indebted  in  this  way  just  where 
they  stand.  No  debtor  is  likely  to  make  any  wise  move 
towards  extricating  himself  from  his  indebtedness  without 
looking  the  situation  frankly  in  the  face.  Until  he  is  ready  to 
acknowledge  to  himself,  his  family,  and  others  interested,  the 
exact  facts  and  probabilities  of  his  situation,  he  will  act  under 
the  influence  of  illusions,  and  his  premises  being  wrong,  his 
conclusions  will  certainly  be  unsound. 

An  indebted  farmer  who  finds  himself  regularly  able  to 
meet  his  interest  payments,  make  some  reduction  of  the' prin- 
cipal, and  keep  clear  of  floating  debt  needs  no  suggestiojis 
from  these  pages.  He  understands  his  business.  If,  however, 
he  is  working  to  the  limit  of  his  strength,  with  old  age  coming 
on,  his  wife  breaking  down  from  overwork  and  anxiety,  and 
the  mortgage  interest  kept  up  only  at  the  cost  of  an  increasing 
floating  debt,  with  its  accompanying  torment  of  duns,  he  will, 


110  ■  TPiE  farmer's  relationships. 

if  willing  to  frankly  consider  his  own  condition,  be  ready  to 
concede  that  he  has  sometime  committed  grave  errors  from 
whose  consequences  he  is  now  suffering.  If  at  some  former 
time  liis  judgment  has  been  at  fault,  he  should  be  willing  to 
acknowledge  to  himself  that  he  may  even  now  be  in  error  in 
some  things,  and  that  there  may  be  suggestions  which  have 
not  occurred  to  him  which  are  yet  well  worth  his  consideration. 

The  farmer  who  is  indebted  beyond  his  ability  to  pay  is 
very  apt  to  consider  his  creditors  as  his  enemies  who  are 
oppressing  him.  There  is  no  sense  in  this.  If  he  does  what 
he  has  agreed  to  do  they  will  not  be  his  enemies.  If  to  any 
extent  they  are  so  now  it  is  because  of  his  own  failure  to  keep 
his  agreement.  Evidently,  since  he  is  unable  to  keep  his  agree- 
ment, it  is  one  that  he  should  never  have  made.  It  may  bo 
true  that  his  inability  to  pay  arises  from  changes  in  conditions 
over  which  he  had  no  control;  but,  as  business  is  universally 
conducted  in  this  world,  the  possibility  of  such  changes  must 
be  considered  by  all  who  make  agreements  to  be  executed  in 
the  future,  and  margins  reserved  for  all  contingencies.  Who- 
ever fails  to  do  this  must  take  the  consequences  when  things 
go  wrong.  Farmers  are  as  strenuous  as  other  classes  in  exact- 
ing this  from  their  debtors.  If  a  farmer  sells  a  horse,  taking  a 
note  in  payment,  and  the  horse  dies  the  next  day,  he  will  still 
require  payment  of  the  note  at  maturity,  and  collect  it  if 
he  can. 

But,  while  farmers  must  abide  the  consequences  of  their 
bad  judgment  in  increasing  indebtedness,  there  is  yet  a  limit 
beyond  which  they  ought  not  to  go.  Neither  law  nor  society 
requires  impossibilities,  nor  is  it  desirable  that  one  man  shall 
be  the  slave  of  another  for  his  lifetime.  While  the  debtor,  as 
a  rule,  has  asked  the  credit,  considered  himself  at  the  time 
fortunate  in  obtaining  it,  and  agreed  to  take  all  risks  of 
depreciation  or  other  misfortune  tending  to  prevent  payment, 
the  creditor  also  took  his  risk.  Under  ancient  civilizations 
the  debtor  who  could  not  pay  became  the  slave  of  the  creditor, 
and  could  bo  bought  and  sold.  In  modern  times  creditors,  in 
making  loans,  or  giving  credit,  know  that  they  will  not  have 
this  ultimate  recourse.     They  must  look  to  the  property  for 


THE    FARMER    AM)    HIS    CREDITORS.  HI 

payment,  and  not  to  the  person  of  the  debtor.  But  as  a  rule 
they  do  not  wish  the  property.  What  they  desire  is  interest 
reguLarly  paid.  Especially  is  this  true  of  banks  and  other 
money-lending  corporations  who,  above  all  things,  hate  fore- 
closures and  the  care  of  property.  If  the  debtor,  living  upon 
the  property,  and  familiar  with  it  and  with  farming,  can  not 
make  it  pay  interest,  the  bank  almost  certainly  can  not.  The 
debtor  who  can  not  pay  interest,  usually  has  but  a  most 
meager  living,  and  no  wages  besides.  If  tlie  bank  takes  the 
property  it  must  pay  good  wages  for  its  care,  and  is  not  likely 
to  get  interest  in  addition. 

AVhen  an  indebted  farmer  finds  that  he  is  killing  himself 
and  his  family  and  still  making  no  progress,  it  is  time  to  stop. 
He  has  done  his  best  and  failed,  and  society  asks  no  more  of 
him.  It  is  not  right  that  he  and  his  should  be  slaves.  His 
creditors  have  erred  in  extending  credit,  as  well  as  himself  in 
obtaining  it,  and,  while  the  severest  consequences  must  fall 
upon  him,  it  is  proper  that  the  creditors  should  bear  their 
share.  At  this  juncture  the  duty  which  society  imperatively 
demands  of  the  debtor  is  absolute  frankness  and  honesty, 
first  with  himself,  and  secondly  with  his  creditors.  It  is 
also  best  for  himself.  There  are  chords  of  sympathy  in  the 
human  breast  which  reach  out  even  from  creditors  to  debt- 
ors. Honesty,  frankness,  and  courage  will  cause  these  chords 
to  vibrate. 

The  first  step  is  to  put  on  paper  a  complete  schedule  of 
liabilities,  down  to  the  minutest  item.  Then  there  should  be 
a  complete  schedule  of  property,  and  a  statement  of  income 
by  items  as  far  back  as  possible.  This  should  be  taken  first 
to  the  mortgage  creditor.  He  is  the  most  secure,  and  it  will 
be  to  his  interest  to  aid  his  debtor  to  a  compromise  with 
others.  The  question  to  be  decided  is  not  one  of  intent  or 
desire  on  the  part  of  the  debtor,  but  what  income  the  property 
can  be  made  to  produce  in  his  hands,  or  whether  some  other 
available  person  can  get  more  out  of  it.  It  is  for  the  interest 
of  all  concerned  that  the  property  shall  be  so  used  as  to 
produce  the  largest  net  income,  and  as  to  this  lenders  of 
money  will    often   be  l)etter  judges  than   borrowers.      If  it 


112  THE  farmer's  relationships. 

should  appear  that,  while  the  income  is  not  sufficient  to  pay 
everythinoj,  it  can  be  made  to  produce  a  good  part  of  the 
indebtedness,  some  kind  of  compromise  will  l^e  made  which 
will  enable  the  farmer  to  go  on.  All  that  can  be  got  out  of  a 
place  is  what  it  will  yield  after  supporting  the  family  which 
works  it.  As  various  considerations  will  impel  the  indebted 
farmer  to  work  cheaper  than  any  one  else,  and  with  a  better 
understanding  of  the  capabilities  of  the  farm,  there  is  nearly 
always  a  ground  for  such  a  settlement  and  reduction  of  lia- 
bilities as  will,  under  the  circumstances,  be  best  for  all.  If 
the  settlement  is  complete,  and  the  margin  for  living  is  not 
cut  too  close,  the  advantage  to  all  will  be  great.  What  kills 
debtors  is  not  hard  work  but  worry.  No  man  can  endure 
continuous  attempts  to  achieve  the  impossible  with  a  penalty 
overhanging  in  case  of  failure.  When  the  task  is  reduced  to 
what  can  be  done,  the  hard  work  continues  but  not  the  worry. 
Life  takes  on  a  different  aspect.  The  arriving  mail  is  no 
longer  looked  to  with  dread  nor  the  calling  stranger  feared 
as  one  who  may  have  papers  to  serve.  Hope  takes  the  place 
of  despair,  and  the  old  renew  their  youth.  Misfortune  has 
befallen  and  has  been  bravely  met.  The  best  that  could  be 
done  has  been  done,  and  there  are  respect  and  esteem  in 
place  of  suspicion  and  doubt. 

The  above  is  the  course  always  taken  by  good  business 
men  in  financial  difficulties.  It  should  be  imitated  by  farmers. 
In  attempting  such  settlement,  legal  advice  should  be  secured. 
In  most  country  towns  there  is  some  elderly,  sensible  lawyer 
whom  everybody  knows  and  respects,  and  who  makes  his 
living  by  keeping  people  out  of  lawsuits.  Go  to  him,  and  to 
the  principal  creditor.  Lay  all  the  facts  before  them,  and 
trust  your  legal  adviser  and  your  principal  creditor  to  reach 
an  agreement  and  bring  in  the  rest. 

The  relation  of  the  embarrassed  farmer  to  his  creditors 
must  be  one  of  perfect  frankness  and  honesty.  Many  lose 
their  homes  who  need  not  do  so. 


CHAPTER   V. 

THE    FARMER   AND   THE    POLITICIAN. 

BY  "politician  "  I  mean  9,  person  who  habitually  seeks  to 
obtain  a  livelihood  from  the  emoluments  of  public  oftice 
or  to  influence  the  bestowal  of  otJice.  He  may  and 
probably  will  have  some  other  ostensible  or  actual  means  of 
support,  and  is  quite  certain  to  be  an  alert  and  capable  person, 
entirely  competent  to  live  independent  of  office,  but  he  has 
acquired  the  office-seeking  habit,  which  is  one  of  the  hardest 
habits  to  break.  A  politician  may  become  a  statesman,  and  as 
such  one  of  tlie  most  honored  and  useful  members  of  society. 
Most  of  them  do  not,  but  at  the  same  time  it  must  be  rec- 
ognized that  the  majority  of  the  office-seeking  class  are  intel- 
ligent and  honest,  and  faithfully  discharge  the  duties  of  any 
position  to  which  they  may  be  elected  or  appointed.  At 
any  rate,  they  must  have  the  appearance  and  reputation  of 
so  doing  or  they  could  not,  at  least  outside  the  large  cities, 
hope  to  succeed.  In  the  aggregate  there  is  doubtless  a  good 
deal  of  official  corruption  in  most  countries,  but  in  the  main 
I  believe  our  officials  personall}"  discharge  the  duties  of  their 
offices  with  zeal  and  fidelity. 

And  yet  it  is  true  that  when  once  an  honorable  man 
becomes  a  candidate  for  an  elective  office,  or  a  "worker" 
who  expects,  in  case  of  the  success  of  his  party,  to  be  rewarded 
by  an  appointive  office,  he  becomes  possessed  of  an  absorbing 
desire  to  win.  This  feeling  is  by  no  means  wholly  mercenary. 
The  joy  of  overcoming  is  of  itself  a  sufficient  inducement  to 
many,  and,  once  engaged  in  a  contest,  all  means  esteemed 
honest  within  the  purview  of  the  very  loose  code  of  political 
morals  are  freely  employed. 

There  is  no  doubt  that  in  the  long  run  the  means  deemed 
most  certain  to  lead  to  success  are  what  is  commonly  spoken 
of  as  "humbug,"  and  of  all  classes  that  deemed  most  suscep- 

(113) 

8 


114  THE  farmer's  relationships. 

tible  to  the  influence  of  political  deception  is  the  farming 
class.  Whether  right  or  wrong,  this  opinion  is  practically 
universal  among  political  managers,  and  party  platforms  are 
framed,  and  political  addresses  delivered  to  rural  audiences, 
upon  the  assumption  that  those  audiences  are  easily  deceived. 
Public  questions  are  almost  never  fairly  presented  by  political 
speakers,  and  it  is  rare  that  political  platforms  unequivocally 
pledge  parties  to  definite  courses  of  action  on  strongly  con- 
troverted topics.  The  art  of  drawing  a  political  platform 
consists  largely  in  skill  to  frame  language  in  such  a  way  as 
to  appear  to  be  very  binding,  while  in  reality  it  leaves 
candidates   elected   nearly  free  to  do  as  they  please. 

The  relation,  therefore,  of  the  farmer  to  the  politician 
should  be  one  of  profound  distrust.  He  must  be  recognized 
as  one  who  means  first  of  all  to  win  if  he  can,  and  who 
believes  the  surest  way  to  success  is  rather  to  excite  and  play 
upon  prejudice  than  to  appeal  to  reason.  He  probably  will 
not  lie  outright,  for  this  is  bad  policy,  and  hence  not  good 
politics,  but  if  he  can  deceive  without  actually  lying  he  will 
do  so  freely  where  he  thinks  it  desirable,  and  if  he  does 
his  work  skilfully,  he  will  stand  the  higher  in  the  councils 
of  his  party.  Of  course  many  politicians  in  heated  campaigns 
do  not  hesitate  to  lie  outright,  but  tliese  are  always  the  small 
fry,  and  in  the  long  run  they  fail.  But  the  farmer  must 
never  expect  a  fair  presentation  of  a  public  question  from  any 
political  orator  or  political  journal.  What  he  must  expect, 
and  what,  in  nine  cases  out  of  ten,  he  will  get  from  Doth 
these  sources  is,  first,  flattery,  to  gain  his  good-will,  and,  next, 
rhetorical  appeals,  more  or  less  effective,  according  to  the 
ability  of  the  s})eaker  or  writer,  to  his  passions,  and  his 
l)rejudice.  The  first  thought  of  the  political  orator  is  to 
arouse  enthusiasm — to  "  bring  the  house  down;"  now  candid 
argument  can  never  have  this  effect,  while  rhetorical  praise 
or  denunciation  always  has  it.  It  is  natural,  therefore,  that 
those  who  desire  to  win  over  an  audience  or  excite  it  to 
greater  endeavor,  should  employ  the  means  which  experience 
has  shown  to  be  successful,  rather  than  to  emplo}^  others 
which  are  known  to  be  less  productive  of  results.     All  popular 


THE    FAKMKll    AND    TIIP:    POLITICIAN.  115 

audiences  are  susceptible  to  this  play  upon  emotions,  but  it  is 
a  fact  tliat  must  be  reckoned  with  that  among  all  classes  of 
politicians  it  is  considered  that  farmers  above  all  others  can 
most  certainly  be  led  captive  by  the  use  of  bold,  unblushing 
humbug.  I  am  not  guessing  at  these  things.  I  have  myself 
helped  to  make  i)arty  })latfonns,  and  have  appreciated  the  grim 
humor  of  astute  politicians  as  they  suggested  phrases  which  we 
all  knew  to  be  meaningless,  but  well  adapted  to  catch  the  rural 
vote.  I  have  heard  good  political  orators  arouse  an  audience 
to  enthusiasm,  and  afterwards  discussed  with  the  speakers  the 
tricks  which  they  employed.  I  know  that  shrewd  politicians 
have  a  very  low  estimate  of  the  intelligence  of  the  farmer, 
and  that  those  are  in  most  demand  by  i>arty  managers  who 
have  most  skill  in  pUiying  upon  rural  prejudice  and  passion. 

Now  all  this  has  its  effect  on  the  farmer's  pocket,  and  it 
is  only  from  this  standpoint  that  I  wisli  to  consider  it.  The 
farmer  is  at  every  election  called  upon  to  vote  upon  the 
adoption  of  policies  which  will  alfect  his  material  welfare,  and 
for  the  election  of  men  by  the  exercise  of  whose  judgment  his 
income  and  taxation  will  be  affected.  If  he  will  impartially 
examine  facts  before  voting,  his  common  sense  may  in  the 
main  be  relied  on  to  lead  him  right.  There  is  no  important 
public  question  which  does  not  involve  an  economic  question, 
and  it  is  certain  that  nearly  all  who  really  understand  how  the 
result  will  affect  tlieir  pockets,  will  vote  as  the}^  think  their 
interests  dictate.  I  think  this  right,  because  if  all  vote  in- 
telligently as  their  pecuniary  interests  require,  the  greatest 
good  of  the  greatest  number  will  result,  whicli  is  the  aim  of 
all  good  government.  But  if  people  vote  after  considering 
but  one  side  of  a  question,  or  if  the  ha])it  of  voting  with  a 
party  leads  them  to  knowingly  vote  for  unworthy  men,  they 
must  take  the  consequences. 

The  most  important  offices  to  the  farmer  are  those  nearest 
to  him.  It  is  of  vastly  more  importance  to  him  to  secure  a 
good  road-master  than  a  good  governor.  In  voting  for  a 
member  of  the  Legislature,  it  is  of  far  more  consequence  that 
he  elect  one  who  will  be  effective  and  influential  in  state 
affairs  than  one  who  is  sure  to  vote  for  the  senator  of  his  party; 


116  THE  farmer's  relationships. 

and  yet  it  is  the  fact  that  v/henever  a  United  States  senator 
is  to  be  chosen,  the  members  of  all  parties  are  frantically 
adjured  to  let  nothing  prevent  voting  for  the  nominees  of 
their  party  for  legislative  positions,  whatever  may  be  their 
opinion  of  tlie  candidate  or  however  much  his  opponent  is  the 
better  man.  And  these  exhortations  have  a  tremendous  effect. 
I  do  not  belittle  the  importance  of  national  issues,  but  it  is 
very  rare  that  they  are  overpowering.  As  a  rule,  when  he 
must  choose  between  them,  local  and  state  issues  are  far  more 
important  to  the  farmer.  A  good  governor  is  of  more  impor- 
tance to  him  than  a  good  President  under  ordinary  peaceful 
conditions.  I  fully  recognize  the  necessity  of  party  organiza- 
tions and  the  wisdom  of  party  nominations  for  state  and  even 
local  offices.  A  party  organization  is  a  great  power,  and  it  is 
important  to  have  some  responsible  organization  stand  as 
sponsor  for  candidates,  to  be  held  responsible  if  they  are 
derelict  in  office,  but  party ''loyalty"  should  not  be  expected 
from  the  mass  of  voters  unless  it  deserves  it,  not  only  by  ad- 
herence to  party  principles,  but  by  the  nomination  of  upright 
and  capable  men  for  office.  Nor  will  anytliing  have  so  great 
an  influence  in  preventing  improper  nominations  as  knowl- 
edge on  the  part  of  party  managers  that  voters  will  not 
accept  bad  men  for  the  sake  of  sustaining  a  good  principle, 
and  that  they  will  place  more  importance  on  state  and  local 
issues  than  on  those  of  a  strictly  national  character.  The 
first  thought  of  a  politician  is  the  success  of  his  party,  to 
which  he  looks  for  his  reward.  What  the  voter  most  needs 
is  good  government,  regardless  of  party.  I  belong  to  a  certain 
political  party  with  which  in  the  main  I  am  in  accord  upon 
national  issues,  and  from  habit,  if  for  no  other  reason,  I  prefer 
to  vote  for  its  nominees,  but  if  it  by  its  nominations  sacrifices 
my  important  local  interests  to  my  less  important  national 
interests,  I  will  not  go  with  it.  I  will  vote  with  my  party  for 
President  and  congressman,  but  if  it  nominates  a  bad  or  weak 
man  for  the  Legislature  I  will  vote  for  his  opponent  if  a  better 
man,  regardless  of  its  effect  on  the  United  States  Senate.  1 
believe  that  to  be  the  proper  course  for  all  men.  If  the  states 
are  well  governed,  the  country  will  be  well  governed. 


THE    FARMER    AND    THE    POLITIflAN.  117 

There  are  certain  offices  which  ouglit  to  seek  the  man, 
and  certain  others  which  it  is  proper  for  tlie  man  to  seek. 
Roughly  the  line  may  be  drawn  between  those  positions 
which  require  the  entire  time,  and  yield  a  livelihood,  and 
those  which  involve  only  a  partial  service  and  whose  pecuniary 
rewards  are  trifling.  The  latter  offices  should  seek  the  man. 
No  man  who  is  fit  for  a  legislative  office  will  willingly  seek  it, 
except  occasionally  a  young  man  who  is  smitten  with  political 
"ambition"  and  sees  in  such  an  opening  the  beginning  of  a 
political  "career."  While  it  is  a  misfortune  to  any  one  to 
desire  'a  political  career,  yet  an  ambition  of  that  kind  is 
entirely  honorable.  No  such  ambition,  however,  should  have 
any  weight  with  the  voters.  The  men  whom  they  need  in 
legislative  positions  are  the  solid,  substantial,  successful  men 
whose  own  success  betokens  their  good  judgment,  and  who 
have  weight  in  their  own  communities.  Such  men  will  very 
seldom  seek  any  office,  but  will  usually  accept  it  if  tendered. 
What  farmers  should  do  is  to  make  their  influence  felt  in 
securing  the  tender  of  nominations  to  men  of  that  kind. 
They  are  not  likely  to  do  so,  however,  nor  is  any  change 
from  present  customs  likely  to  "be  effected  in  the  near  future. 
It  will  not,  therefore,  be  profitable  to  pursue  this  subject 
further,  but  it  has  seemed  proper  to  point  out  that  for  eco- 
nomic reasons  farmers  should  exert  themselves  to  make  sure 
that  those  who  levy  taxes  upon  them,  and  determine  for  what 
purposes  the  public  funds  shall  be  expended,  shall  be  men  of 
sound  judgment  and  good  repute.  It  is  in  legislative  positions 
that  op})ortunities  for  corruption  exist.  Large  sums  of  money 
are  often  expended  to  procure  nomination  and  election  to  such 
positions.  Why  is  this?— If  the  candidates  are  rich,  it  may 
be  pride  or  political  ambition.  If  they  are  not  well  off,  and 
are  spending  money  freely,  they  should  be  defeated  if  possible. 
There  are  no  emoluments  to  such  positions  which  can  be 
accepted  b}'  honest  men.  When  money  is  expended  to  elect 
a  poor  man  to  fill  them,  it  almost  invariably  happens  thai 
some  private  interest  is  supplying  it,  which  will  expect  to 
control  the  vote. 

In  great  campaigns  enormous  sums  of  money  are  spent. 


118  THE  farmer's  relationships. 

Bonfires,  halls,  brass  bands,  uniforms,  torch  lights,  and  all  the 
paraphernalia  which  are  used  to  awaken  enthusiasm,  cost 
mone}'.  Who  pays  it?  Whoever  it  is,  he  expects  his  reward. 
It  may  be  a  suitable  reward  which  is  proper  to  be  given.  It 
may  be  the  reverse.  In  any  case  the  farmer  and  the  public  are 
entitled  to  know  the  facts.  Such  expenses  are  legitimate  and 
necessary  when  not  on  an  extravagant  scale,  and  it  is  creditable 
to  any  one  who  is  able  to  do  so  to  contribute  to  the  success  of 
his  })arty.  It  is  entirely  proper,  therefore,  that  the  names  of 
those  who  contribute  shall  be  made  public.  If  they  are  not, 
and  there  is  any  unwillingness  to  disclose  them  upon  request, 
tlie  farmer  may  surely  know  that  it  is  for  some  reason  which 
will  not  bear  tlie  light,  and  concerns  the  control  of  men  and 
measures  in  private  interests.  It  is  money  spent  to  humbug 
the  farmer  into  voting  for  he  knows  not  what.  The  money 
whose  contributors  are  unwilling  to  be  known  should  never 
be  spent  in  political  campaigns.  The  key-note  of  a  campaign 
for  political  party  should  be  a  demand  for  the  publication  of 
the  names  of  contributors  to  party  treasuries.  Whenever  an 
election  of  a  Legislature  is  pending  wliich  is  to  elect  a  United 
States  senator,  it  is  not  unusual  for  a  candidate  for  that  office 
to  pay  the  election  expenses  of  all  candidates  which  can  be  got 
to  accept  such  aid.  It  is  seldom  that  these  candidates  can 
themselves  afford  the  expenses.  Who  does  really  meet  them? 
It  can  seldom  be  proven,  but  it  is  a  matter  that  farmers  should 
take  note  of,  although  it  is  a  matter  in  which  tliey  can  not 
protect  themselves  by  giving  their  vote  to  the  other  party,  for 
all  parties  are  alike,  but  they  can  sometimes  do  the  right  thing 
by  voting  for  the  party  which  seems  to  be  poor.  Poverty  is 
the  most  honorable  condition  for  a  political  party. 

There  is  another  class  of  offices,  including  most  appointive 
offices,  and  all  those  about  county  seats  and  state  capitals 
which  afford  a  means  of  living  for  a  term  of  years.  If  any  one 
is  foolish  enough  to  desire  them  it  is  proper  to  seek  them,  and 
to  be  at  reasonable  expense  to  obtain  them.  In  this  case  the 
public  can  usually  see  who  pays  the  expense,  and  understand 
why  he  pays  it.  The  man  pays  the  money  to  get  tlie  office 
because  he  wants  it.     If  the  voter  likes  him,  let  him  vote  for 


THE    FAKMKR    AM)    THE    POLITICIAN.  119 

liim.  If  he  prefers  some  one  else,  let  him  cast  his  vote  accord- 
ingly. With  none  of  these  administrative  positions  should 
"politics"  have  anything  to  do.  Their  incumbents  are 
employed  by  the  public  to  perform  certain  duties  laid  down  in 
the  law.  Sometimes  they  have  opportunities  to  steal,  and  do 
so.  Usually  they  discharge  their  duties  honestly.  It  is  in  the 
legislative  positions  connected  with  state  and  local  govern- 
ments that  there  is  most  danger  of  corruption,  and  the  voter 
has  his  greatest  safeguard  against  dishonesty  in  these,  when  he 
knows  whose  money  is  spent  to  elect  the  candidate. 


CHAPTER     VI. 

THE    DISCONTENT    OF    THE    FARMER. 

THE  subject  of  tliis  chapter  includes  the  relation  of  the 
farmer  to  himself  and  to  mankind.  The  farmer  mingles 
less  than  others  with  other  men,  and  so  tends  to  become 
introspective — to  think  about  himself.  This,  when  carried  to 
extremes,  always  produces  a  morbid  condition  of  mind,  as  is 
shown  in  criminals  condemned  to  solitary  confinement,  who 
tend  to  become  insane.  Tliere  is  no  doubt  that  the  compara- 
tively isolated  life  of  the  farmer  often  produces  an  unliealthy 
condition  of  mind,  of  which  the  leading  symptom  is  an 
unreasonable  discontent  with  his  own  lot.  I  do  not  mean  by 
this  that  all  discontent  of  the  farmer  is  unreasonable,  but  that 
some  of  it  is,  and  that  it  is  often  hard  to  distinguish  between 
that  which  is  and  that  which  is  not  reasonable. 

In  discussing  the  relation  of  the  farmer  to  the  politicians  I 
have  had  occasion  to  point  out  the  low  esteem  in  whicli  the 
intelligence  and  astuteness  of  the  farming  class  is  held  by 
those  whose  trade  it  is  to  induce  masses  of  men  to  vote  as  they 
desire,  and  the  same  feeling  is  prevalent  to  a  considerable 
degree  among  all  classes  of  men  and  with  regard  to  all  classes 
of  subjects.  The  business  world  does  not  believe  in  the  mental 
competence  of  the  farmer. 

I  do  not  think  this  popular  judgment  upon  the  farmer's 
capacity  well  founded.  I  think  the  farming  class  contains 
as  large  a  proportion  of  vigorous  although  untrained  minds 
as  any  other  class,  but  they  are,  for  the  most  part,  inarticulate. 
The  habit  and  environment  of  the  farmer  are  not  favorable  to 
the  practice  of  oral  or  written  speech,  nor  has  he  at  command 
the  library  facilities  wherewith  to  fortify  himself  for  public 
utterance.  It  is  also  true  that  the  majority  of  farmers,  like 
the  majority  of  other  classes,  are  occupied  in  transacting  busi- 
ness rather  than  in  thinking  upon  its  principles.  Finally  they 
(120) 


Tin-:  DTsroxTKXT  OF  Tin-;  farmer.  121 

suffer  ill  the  estimation  of  nuinkind  from  the  utterances  of 
their  self- constituted  champions.  As  with  workingmeu,  the 
mercantile  class,  and  even  lawyers,  the  capacity  of  farmers  for 
public  speech  is  often  in  an  inverse  ratio  to  their  practical 
wisdom,  and  the  desire  to  engage  in  it  is  very  apt  to  be  in  such 
ratio.  The  deliverances  of  men  and  organizations  in  whose 
judgment  the  substantial  farmers  themselves  have  little  confi- 
dence, are  assumed  to  be  the  opinions  of  the  great  body  of 
farmers,  from  whom,  in  fact,  we  really  hear  very  little. 

So  far  as  the  farmer  is  discontented  it  is  because  he  is 
unable  to  obtain  from  the  products  of  his  farm  the  satisfac- 
tions which  he  desires.  This  covers  the  entire  subject,  and  so 
far  as  the  mere  statement  of  the  causes  of  his  discontent  is 
concerned,  this  chapter  might  well  end  here.  When  I.  have 
said  all  that  I  shall  say,  this  will  be  the  final  summing  up. 
But  in  this  the  farmer  is  not  peculiar.  The  majority  of  man- 
kind are  in  the  same  condition.  The  workman — skilled  and 
unskilled — is  also  discontented  because  the  sum  of  his  possible 
sacrifices  will  not  secure  the  aggregate  of  his  desired  satisfac- 
tions. So  is  the  merchant,  the  lawyer,  tlie  doctor,  and  the 
money  lender. 

If  it  be  said  here  that  I  should  confine  myself  to  such 
causes  of  discontent  as  afi'ect  only  the  farmer,  I  may  say  that 
if  I  am  to  deal  with  real  causes,  and  not  their  mere  operation 
or  manifestation,  I  know  of  none  which  do  not  operate  upon 
all  classes  alike,  nor  do  I  believe  there  are  such.  One  law 
seems  to  me  to  govern  mankind.  Its  violation  always,  and 
sometimes  its  fulfilment,  causes  suffering ;  and  suff'ering,  discon- 
tent. Through  all  nature  runs  the  grim  stoiy  that  the  strong 
survive  and  the  w^eak  perish,  and  that  discontent  lies  mostly 
with  the  weaker.  I  do  not  find  that  well-to-do  farmers,  or 
shop-keepers,  or  workingmeu  suffer  very  much,  or  that  they 
are  possessed  of  any  but  that  rational  discontent  which  we 
usually  call  ambition,  and  which  is  tlie  mainspring  of  progress. 

It  is  tiien  with  the  poorer  farmers  that  we  have  mostly  to 
deal  in  considering  the  causes  of  such  discontent  as  is  the 
result  of  real  suffering  from  economic  causes.  Almo.st  inva- 
riably these  will  be  found  in  debt  beyond  their  ability  to  pay. 


122  THE  farmer's  relationships. 

The  actual  owner  of  five  acres  of  land  from  which  he  gets  a 
living  for  himself  and  family,  is  a  small  capitalist  who  proves 
by  keeping  out  of  debt  that  he  has  adapted  himself  to  his 
environment  and  is  thus  in  a  way  to  survive.  If  he  has 
irrational  discontent,  the  causes  thereof  are  incident  to  his 
personal  character,  and  demand  no  special  thought.  It  is 
the  indebted  farmer  who  complains  aloud,  and  the  causes  of 
whose  discontent  deserve  investigation.  And  yet,  putting 
aside  the  question  of  his  weakness,  which  we  can  not  mend, 
we  can  not  reach  the  real  sources  of  his  discontent  without 
considering  the  situation  not  only  of  all  other  farmers,  but  of 
all  other  classes. 

The  causes  which  are  usually  assigned  as  the  sources  of  the 
farmer's  discontent  are  appreciation  of  money,  inequality  of 
taxation,  monopolistic  combinations,  excessive  transportation 
charges,  donations  of  public  lands  to  be  worked  in  competition 
with  land  which  farmers  have  paid  for,  the  exploitation  of 
new  lands  and  inferior  races,  and  the  competition  of  expensive 
machinery  which  the  small  farmer  can  not  own.  Most  of 
these  subjects  are  considered  in  detail  in  other  chapters  of  this 
book.  In  this  ])lace  it  is  only  necessary  to  call  attention  to 
the  fact  that  the  operation  of  these  causes  is  not  uniform  even 
upon  farmers.  They  help  some  while  injuring  others.  The 
Nebraska  farmer  who  owes  an  old  debt  is  hurt  by  the  appre- 
ciation of  the  purchasing  power  of  money,  while  the  Connecti- 
cut farmer  who  holds  the  little  mortgage  is  greatly  comforted 
thereby.  The  farmer  who  hires  help  in  fruit  harvest  desires 
cheap  labor.  The  one  who,  with  his  family,  works  in  the 
cannery  after  his  grain  is  cut,  desires  wages  to  be  high.  All 
these  are  farmers.  The  farmer  desires  cheap  cloth,  cheap 
machinery,  and  cheap  transportation,  but  the  owners  and 
operatives  who  produce  these  commodities  all  desire  them 
to  sell  liigh.  Here  tlie  farmer  clashes  with  other  classes.  By 
as  much  as  he  is  satisfied  in  these  particulars,  by  so  much 
some  other  class  tends  to  discontent.  We  are  on  boggy  ground 
unless  we  can  hit  upon  some  law  which  operates  uniformly 
on  all. 

And   this  brings   us   face  to  face  with   a  question  whose 


THE    DISCONTENT    OF    THE    FARMER.  123 

determination  is  an  essential  prerequisite  to  any  intelligent 
or  useful  discussion  of  the  causes  of  discontent  in  any  class. 
What  ought  the  farmer  to  get  from  his  farm?  Is  his  discon- 
lent  reasonable  or  unreasonable?  If  the  latter,  we  need  pay 
no  attention  to  it;  if  the  former,  there  must  be  a  remedy. 
But  certainly  before  we  can  consider  a  remedy  we  need  to 
know  the  exact  nature  and  extent  of  the  injustice.  Otherwise 
we  at  once  sink  in  a  quagmire  of  muddy  thought.  The 
farmer  on  rich  bottom  land  is  discontented  because  his  smaller 
neighbor  will  not  sell  out  to  him.  Ought  his  farm  to  yield 
him  the  means  of  offering  a  temptation  which  his  neighbor 
can  not  resist?  The  farmer,  on  some  poor  hillside  is  discon- 
tented because  his  farm  will  not  pay  off  a  debt  improvidently 
incurred  for  unremunerative  improvements.  Ought  tlie  poor 
farm,  or  society  at  large,  to  be  held  responsible  for  the  un- 
wisdom of  its  owner?  What  is  a  reasonable  standard  of  life 
for  the  farmer?  What  ought  to  be  tlie  reward  of  the  thrift 
by  which  means  to  buy  and  stock  the  farm  were  provided, 
and  the  physical  and  mental  capacity  required  for  its  successful 
management?  And  since  the  satisfactions  of  the  farmer  must 
largely  come  from  the  sacrifices  of  other  cLasses,  we  can  not 
determine  the  measure  of  the  injustice,  if  any,  which  the 
farmer  endures,  without  considering  what  is  due  also  to  others. 
And  if  we  do  not  know  the  exact  injustice  we  can  not  know 
the  real  cause  of  his  just  discontent,  much  less  intelligently 
discuss  a  remedy.  What  is  the  rational  standard  of  life  for 
all  of  us?  What  ought  we  to  have  the  means  to  procure? 
Ought  the  standard  to  be  uniform  for  all?  If  not,  what  ought 
each  class  to  get,  and  individuals,  according  to  their  ability 
and  thrift,  within  their  class?  Can  we  improve  on  nature's 
method  of  letting  us  all  fight  it  out  among  ourselves?  It  is 
easy  to  make  a  list  of  things  which  farmers  do  not  like,  and 
call  them  the  causes  of  their  discontent;  but  are  they  causes, 
or  are  they  mere  manifestations  cf  some  deeper  cause? 

I  think  the  latter,  and  that  in  this  country  the  one  cause 
of  unreasonable  discontent  among  farmers  is  the  absence  of 
any  well-defined  ideal  of  a  standard  of  life  such  as  most 
farmers  may  reasonably  hope  to  reach   and   maintain.     Our 


124  THE  farmer's  relationships. 

experience  in  the  development  of  a  new  country  has  been 
such  that  boundless  opportunities  seemed  open  to  all;  all 
have  had,  consequently,  boundless  ambition,  and  boundless 
ambitions  are  never  satisfied. 

Of  course  we  may  go  still  deeper,  if  we  desire,  and  inquire 
whether  unreasonable  discontent  is  iiot  part  of  man's  nature, 
and  irremediable  except  by  a  slow  evolutionary  process  which 
shall  kill  off  the  discontented,  if  indeed  it  is  not  that  class 
which  is  likely  to  survive.  But  it  is  bad  enough  to  get  out  of 
economics  into  ethics  without  leaving  that  perhaps  rather 
boggy  ground  fur  the  wide  ocean  of  psychology,  and  antropol- 
ogy,  and  evolution,  wherein  no  man  may  touch  bottom.  And 
yet,  wlien  we  approach  an  economic  subject,  we  are  compelled 
to  recognize  that  beneath  every  problem  in  economics  there  lies 
a  deeper  problem  in  ethics  which  can  not  be  ignored  if  there 
is  to  be  intelligent  discussion.  The  ethical  problem  which 
underlies  the  question  of  the  causes  of  the  farmer's  discontent, 
is  that  of  a  rational  standard  of  the  farmer's  life,  and  as  the 
farmer  is  not  alone  in  tlie  world,  of  the  rational  standard  of 
all  life. 

In  attacking  this  subject  I  am  compelled  to  break  what,  so 
far  as  I  can  discover,  is  new  ground.  So  far  as  this  subject 
has  been  considered  at  all  it  has  been  approached  from  the 
standpoint  of  the  artisan  or  the  urban  resident.  It  seems  to 
me  that  the  first  class  to  be  considered  is  the  farmers,  because 
this  is  the  only  class  essential  to  the  existence  of  the  race. 
Other  classes  exist  for  its  comfort,  and  are  entitled  to  due  con- 
.sideration,  but  from  an  economic  standpoint  the  farmer  is  tlie 
only  necessary  man.  In  addition  to  that,  his  manner  of  life 
is  in  a  great  measure  fixed  by  external  causes  entirely  beyond 
his  control,  which  is  true  of  hardly  any  other  class  except 
.sailors.  Early  in  the  morning  and  late  at  night  the  farmer 
must  minister  to  the  animals  which  serve  him.  When  tlie 
ground  is  right,  he  must  cultivate  it,  sometimes  as  long  as  he 
can  see.  When  the  crop  is  ripe,  he  must  work  hard  and  for 
long  hours  to  gather  it.  There  can  be  no  eight-hour  day 
for  him.  Why  should  he  work  twelve  hours  that  those  who 
make  his  shoes  or  build  his  houses  should  work  only  eight 


THE    DISCONTENT   OF    THE    FARMER.  125 

hours?  And  the  farmer's  wife,  liow  many  hours  must  she 
work?  And  the  workman's  wife?  Who  ever  lieard  of  an 
eight-hour  day  for  them  What  is  just  for  one  is  just  for  all, 
men  and  women.  And  the  necessary  standard  of  the  farmer 
must  be  the  basis  for  other  standards. 

It  seems  to  me  that  the  farmer  and  his  wife  must  expect  to 
work  twelve  hours,  on  the  average,  every  day,  some  of  the 
time  at  light  work.  I  believe  they  are  perfectly  healthy  in  so 
doing,  and  happy  when  they  get  reasonable  satisfactions  in 
exchange  for  their  sacrifices.  I  think  a  reasonable  satisfaction 
for  a  farmer  is  a  comfortable  but  modest  home,  abundant  but 
plain  food,  plenty  of  stout  work  clothing,  and  a  good  suit  for 
Sunday,  a  comfortable  conveyance  to  take  his  family  to  church 
in,  moderate  education  for  a  reasonable  number  of  children, 
and  such  an  income  beyond  that  as  will  enable  him  to  safely, 
when  a  young  man,  incur  interest-bearing  debt  for  half  the 
value  of  the  land  which  he  tills,  with  the  expectation  of  pa}'^- 
ing  it  off  by  the  time  he  is  fifty  years  old,  and  retiring  from 
labor  when  sixty.  For  his  own  blunders  or  extravagance  he 
must  pay,  and  by  as  much  as  he  expends  effort  in  this  way, 
by  so  much  he  should  fail  of  earned  satisfactions  in  other 
respects.  1  think  tiiis  a  just  standard  of  life  for  the  farmer, 
and  that  the  standards  of  other  lives  should  be  based  on  this. 

Only  the  stout  farmers  can  now  attain  this  standard — those 
who  would  get  over  the  heads  of  their  fellows  in  any  walk  of 
life,  not  always,  by  the  way,  the  most  useful  or  the  most  amia- 
ble of  men,  but  the  most  effective.  It  is  unsafe  for  the  farmer 
of  ordinary  abilities  to  incur  debt,  and  without  debt  it  is  not 
usually  possible  for  young  farmers  to  get  farms.  The  reason 
of  it  is  that  too  large  a  portion  of  their  income  is  taken  by 
capitalists,  traders,  and  workingmen,  of  whom  the  latter  take 
by  far  the  most,  and  yet  not  sufficient  for  their  necessities. 

It  seems,  then,  to  me,  that  the  fundamental  cause  of  the 
farmer's  discontent  is  the  absence  from  his  own  mind  of  a 
clear-cut  ideal  of  the  measure  of  the  reward  which  is  justly 
due  him  from  society,  with,  in  many  cases,  a  notion  more  or 
less  vague  of  an  ideal  which  he  could  not  reach  without 
injustice  to  other  classes;    for  it  must  not  be  forgotten  tliat 


126  THE  farmer's  relationships. 

although  the  farmer  is  the  only  man  necessary  to  our  exist- 
ence, and  as  such  certainly  entitled  to  something  more  than 
what  may  hapjjen  to  be  left  after  satisfying  others,  yet  it  is  to 
other  classes,  after  all,  that  we  are  indebted  for  what  really 
makes  existence  worth  supporting,  and  they  are  entitled  to 
their  due.  To  this  fundamental  trouble  is  added  the  fact  that 
the  farmer,  through  ignorance,  largely  wilful,  of  facts,  and  his 
unwillingness  to  work  with  his  fellows,  does  not  in  the  main 
succeed  in  getting  what  he  should  and  might  have. 

As  for  the  "  remedies  "  proposed  or  possible  for  this  state 
of  things  I  have  not  much  to  say  here.  Many  of  them  are 
discussed  in  other  chapters.  Many  of  those  proposed  by  the 
farmers  themselves  I  do  not  think  of  much  value.  But,  as 
I  have  already  said,  it  is  not  the  wdsest  farmers  that  we  hear 
most  from.  Those  who  speak,  who  are  usually  the  indebted, 
do  not  seem  to  rae  to  always  understand  their  own  case.  A 
great  physician  once  said  to  me  that  he  never  knew  a  man 
who  was  smart  enough  to  correctly  count  his  own  pulse. 
Perhaps  most  of  us  are  not  good  judges  of  our  own  ailments. 
The  articulate  farmers  do  not  say  that  they  are  weak  and 
erring,  or  recognize  that  with  the  end  of  our  new  lands  the 
era  of  speculative  farming  is  over  in  America,  and  that  of 
close  business  methods  begun,  but  attribute  their  trouble 
rather  vaguely  to  "rings,"  "combinations,"  and  "monopolies." 
Now  these  agencies,  so  far  as  they  exist,  can  inflict  economic 
injury  upon  the  farmer  only  by  lowering  the  price  of  what 
he  has  to  sell,  or  raising  that  of  what  he  has  to  buy.  As  a 
matter  of  fact  they  have  not  done  the  latter,  for  all  commodi- 
ties, even  transportation,  which  the  farmer  has  to  buy,  are  now 
lower  than  at  the  date  when  any  long-standing  debt  was 
incurred.  The  farmer  must  have  estimated,  if  he  estimated 
at  all,  upon  paying  more  for  what  he  buys  than  he  does 
pay,  and  in  so  far  as  the  prices  of  what  he  has  to  sell  have 
fallen,  they  have  done  so  largely  as  the  result  of  cheaper 
production  and  of  overproduction  in  whicli  he  has  himself 
participated,  often  induced  by  the  representations  of  bright 
and  unscrupulous  men  that  the  impossible  would  happen. 
I  have  little  faith  in  the  legislative  remedies  to  which  farmers 


THE    DISCONTENT    OK    THE    FARMER.  127 

continually  turn,  not  even  in  such  matters  as  the  currency 
and  the  tariff.  So  only  that  any  policy  he  made  permanent, 
it  seems  to  me  that  we  shall  all  get  on  ahout  alike  under  it. 
As  matters  stand  the  only  remedy  which  I  have  to  suggest 
for  the  next  few  generations  is  that  farmers  must  know  more 
and  fight  harder.  As  a  farmer  I  desire  cheap  labor,  cheap 
transportation,  and  cheap  merchandise  of  all  kinds  that  I 
have  to  buy,  and  high  prices  for  everything  that  I  have  to 
sell.  All  other  classes  are  in  the  same  situation.  It  is  a  law 
of  commerce  that  no  agreement  is  possible  between  contending 
interests,  until  after  an  exhaustive  trial  of  strength.  It  is 
also  a  law  that  agreement,  when  possible,  invariably  follows 
such  contests.  We  are  now  engaged  in  the  conflict,  which 
I  suppose  will  continue  indefinitely,  and  sometime  close  in 
the  usual  way.  None  of  us  now  here  will  see  the  close,  or 
can  even  imagine  the  nature  of  a  settlement.  But  we  know 
that  it  will  be  made,  for  it  is  the  law. 

The  law  of  nature  is  that  the  due  of  every  man  shall  be 
all  that  he  can  get  and  keep.  She  seems  to  have  filled  the 
world  with  warring  organisms,  for  the  mere  pleasure  of  seeing 
them  fight,  caring  nothing  who  shall  conquer.  This  process, 
which  results  in  the  untimely  death  of  the  majority,  we  have 
learned  in  these  later  years  to  call  evolution.  But  evolution 
has  at  last  developed  a  race  which,  having  overcome  all  other 
beings,  shows  signs  of  trying  conclusions  with  nature  herself. 
The  history  of  mankind  is  a  story  of  constant  warfare  with 
nature,  and  constant  victory  for  man.  Of  later  years  there 
is  an  increasing  number  of  those  who  are  determined  to 
abolish  the  method  of  distribution  of  satisfactions  according  to 
strength  alone,  which  is  the  corner-stone  of  nature's  method. 
Who  shall  say  that  the  progress  of  evolution  shall  not  destroy 
evolution  itself?  Possibly  it  may,  and  then  may  come  the 
end  of  all  things.  Certainly  we  can  have  no  conception  of 
life  unaccompanied  by  struggle.  The  condition  wherein  no 
struggle  is,  we  call  death.  This  may  be  all  wrong,  since  the 
ages  which  will  be  required  for  such  develojiment  may  be 
sufficient  for  the  evolution  in  us  of  qualities  which  will  make 
existence  without  struggle  endurable.     We  can  not  tell.     Such 


128  THE  farmer's  relationships. 

a  race  would,  perhaps,  differ  no  more  from  us  than  we  differ 
from  the  primeval  man.  So  far  as  we  can  now  conceive,  it 
would  be  a  race  of  degenerates. 

But  if  we  fight  nature,  we  must  fight  together.  So  long  as 
we  are  divided,  slie  is  too  strong  for  us.  And  yet  by  her  own 
law  she  may  be  contributing  to  her  own  destruction,  since,  if 
we  reach  unity,  it  must  be  by  the  extinction  of  those  who  will 
not  cooperate.  The  single  man  can  not  compete  with  organ- 
ized man— is  not  now  doing  it  successfully.  The  best  organ- 
ized are  the  most  prosperous.  Those  who  will  not  cooperate 
will  die.  The  farmer,  being  now  less  organized  than  some 
others,  suffers  in  ways  that  we  have  seen.  Gradually  he  will 
cooperate  more,  because  his  environment  will  compel  him. 
In  part,  it  may  be  the  present  farmers  who  will  do  this,  and, 
in  part,  the  successors  of  those  who  will  die  because  they 
will  not  cooperate.  At  present,  his  incompetence  to  act  for  the 
common  ends  with  his  fellows  is  a  great  cause  of  the  farmer's 
discontent. 

It  will  be  seen  that  I  do  not  think  that  the  real  causes  of 
the  farmer's  discontent  lie  upon  the  surface,  or  can  be  removed 
by  local  treatment.  If  the  farmer  could  pay  all  his  debts  with 
what  he  calls  cheap  money,  be  relieved  from  all  taxation,  and 
be  given  free  transportation  for  himself  and  his  produce,  with 
a  bounty  on  all  his  exports,  so  far  as  he  is  discontented  he 
would  be  discontented  still.  Possibly  he  would  be  more  dis- 
contented, since  the  seemingly  more  genial  environment  would 
attract  to  the  industry  still  more  of  the  weaker  sort.  As  I  have 
said,  we  do  not  know  what  qualities  may  yet  develop  in  our 
race,  but,  as  we  are  now,  the  rugged  conditions  of  competition 
tend  to  eliminate  discontent  by  the  brutal  process  of  the 
destruction  of  the  discontented. 

We  are  all  children  of  one  family,  governed  by  one  law. 
I  can  conceive  of  no  adequate  treatment  of  the  condition  of 
the  farmer  except  in  connection  with  the  condition  of  others. 
In  the  operation  of  the  law  which  controls  all  of  us,  I  have 
seemed  to  myself  to  find  the  real  causes  of  the  farmer's  dis- 
content, and  to  get  some  glimpse  of  the  remedies  which  must 
cure  it.      The  first  step  is  to  decide  what  is  a  reasonable 


THE    DISCONTENT    OF    THE    EARMER.  129 

standard  of  life  for  the  industrious,  honest,  and  thrifty,  with 
wliich,  when  attained,  we  should  be  content,  and  beyond 
which  desire  is  unreasonable.  The  next  step  is  to  learn  liow 
to  control  tlie  unreasonable.  Here  is  where  we  must  fight 
nature,  who  favors  the  unreasonable,  if  they  be  strong.  We 
do  not  need  to  concern  ourselves  witli  the  lazy,  the  dishonest, 
or  the  unthrifty.  Nature  will  take  care  of  them.  She  will 
kill  them. 


BOOK    FOURTH. 

The  Farmer  as  a  Business  Man. 


CHAPTER   I 


THERE  are  mean  men  in  all  walks  of  life.  The  accumu- 
lating instinct,  where  it  is  decidedly  strong,  involves  a 
certain  hardness  of  character  which  is  not  lovely.  But 
on  the  other  hand,  the  accumulating  instinct  has  its  corre- 
sponding virtues.  The  accumulating  man  is  careful  in  prom- 
ise, but  punctual  in  fulfilment.  When  a  strong  desire  to 
possess  is  joined  to  a  character  of  weak  moral  fiber,  we  have 
the  typical  "  mean  man"  of  the  country  town.  Those  are  the 
men  who  are  on  the  watch  to  take  advantage  of  necessity, 
lending  money  at  rates  which  no  business  can  pay,  and  ruth- 
lessly sacrificing  the  security  when  default  of  payment  is  made. 
These  men  seldom  attempt  to  do  anything  which  they  have 
not  the  legal  right  to  do.  They  prey  upon  the  weakness  and 
bad  judgment  of  their  fellow-men. 

Somehow,  rural  popular  opinion  tends  to  associate  men  of 
this  class  with  the  banking  business.  Nothing  could  be  further 
from  the  truth.  Occasionally,  of  course,  a  "mean  man"  con- 
trols a  bank,  but  very  seldom.  In  the  first  place,  such  men  are 
not  usually  satisfied  with  the  profits  of  the  banking  business, 
but,  even  if  they  were,  they  are  not  able  to  get  into  it,  for  the 
reason  that  the  other  stockholders  will  not  have  them.     The 


*  See  Appendix  E  for  documents  relating  to  subjects  of  this  book, 
(130) 


THE    FAiniEK    AM)    Till:    liAXKEJ;.  131 

essence  of  the  banking  business  is  a  protit  on  deposits,  and 
those  in  control  of  the  bank  must  not  be  obnoxious  to  the 
mass  of  the  people.  The  managers  of  a  bank  must  be  men 
who  have  the  respect  and  good-will  of  the  community,  or 
deposits  will  be  light,  and  the  bank  unprofitable. 

It  is  another  popular  error  to  consider  the  managers  of 
banks  as  persons  of  great  wealth.    Of  course,  wealthy  men  often 
do  manage  banks,  but,  as  a  rule,  the  officers  of  banks  are  men 
of  moderate  means,  but  high  character,  employed  upon  fair, 
but  not   large,  salaries.     They  are  not  handling   their  own 
money,  but   that  of  others,  and  the  rules  upon  which  they 
handle  it  are  not  made  by  themselves,  but  are  the  result  of 
the  experience  of  all  banks.     The  money  of  the  banks  is  not 
largely  the  property  of  the  stockholders,  mucli  less  of  the  man- 
agers, but  belongs  to  those  who  have  deposited  it,  and  who  have 
the  right  to  take  it  out  without  notice.     The  profit  of  banking 
arises  from  the  known  fact  that,  while  every  dollar  of  deposits  in 
commercial  banks  is  subject  to  check  at  sight,  as  a  matter  of  fact 
the  greater  portion,  in  ordinary  times,  will  be  allowed  to  remain 
indefinitely,  the  witlidrawals  and   deposits  about   balancing 
each  other  from  week  to  week.     From  seventy-five  to  eighty-five 
per  cent  of  the  deposits  can,  therefore,  be  loaned  with  safety,  and 
the  interest  on  these  loans,  less  the  expenses  of  tlie  bank,  is  the 
profit  of  banking.     To  this  is  added  commissions  on  collec- 
tions and  exchange,  and  on  the  sale  of  securities.      If  local 
bonds  are  issued,  either  by  the  public  or  by  industrial  enter- 
prises, a  local  bank  may  subscribe  for  the  entire  issue  with  the 
view  of  selling  them  to  customers  at  a  small  profit.     Some- 
times, in  spite  of  the  low  interest  which  first-class  bonds  usually 
bear,  they  are  retained  as  permanent  investments  of  the  bank, 
becauso,  in  case  of  sudden  calls  for  money  from  deposits  in 
unexpected  amounts,  first-class  bonds  are  highly  available  as 
securities  u]>on  which  the  bank  itself  may  borrow  money  to 
pay  depositors.    In  cases  of  sudden  demands  for  money,  country 
banks  frequently  have  to  borrow  largely  of  city  banks  to  pay 
depositors,  although   ordinary  demands  are   usually  foreseen 
and  prepared  for.     It  is  quite  evident,  however,  that  if  a  bank 
owes  j;^100,000  to  depositors,  of  which  $75,000  is  loaned  out  and 


132  THE    FARMER    AS    A    BUSINESS    MAN. 

not  due,  it  is  not  in  a  position  to  pay  on  demand,  if  the  greater 
part  of  its  depositors  call  for  their  money.  For  this  reason  the 
loans  of  commercial  banks  are  always  made  on  short  time — 
usually  from  thirty  to  ninety  days — so  that  its  funds  may  be 
available  to  pay  depositors  at  short  notice.  A  country  bank 
which  should  owe  depositors  $100,000,  would  probably  have 
a  capital  of  $50,000,  of  which  a  portion  would  probably  be 
invested  in  its  business  premises  and  furniture,  a  portion  in 
some  reliable  bonds,  capable  of  being  quickly  turned  into 
money,  and  the  remainder  paid  into  the  business  for  loaning. 
The  bank's  capital  is  the  security  to  depositors.  In  most  states, 
also,  the  stockholders  are  personally  liable  to  depositors,  to  a 
certain  extent,  in  case  of  failure. 

A  high  character  for  integrity  is,  of  course,  a  prerequisite  to 
employment  of  any  kind  in  a  bank.  In  addition  to  this,  the 
responsible  ofhcers  must  be  personally  popular,  in  order  to 
attract  deposits,  and  sound  judges  of  the  value  of  })roperty, 
and  of  men,  in  order  to  make  safe  loans.  In  addition  to 
the  judgment  of  the  president  and  cashier,  all  considerable 
loans  must  be  passed  upon  by  a  "  security  committee  "  of  the 
directors. 

Bank  failures  occur  from  bad  loans.  The  officers  of  the 
bank  have  lent  money  on  property  which  is  unable  to  earn 
interest  upon  it,  or  upon  personal  security  which  proves  bad. 
In  the  majority  of  cases,  this  occurs  from  putting  too  much 
confidence  in  one  man — usually  the  president — who  has  lent 
the  bank's  money  either  to  himself,  or  to  enterprises  in  which 
he  is  interested,  or  to  personal  friends. 

As  farmers  are  quite  as  much  interested  in  sound  banking 
as  any  other  class,  they  can  do  much  towards  effecting  a  radical 
reform  by  urging  the  passage  of  laws  forbidding  banks  to 
make  any  loan  whatever  to  their  own  officers,  or  to  any  busi- 
ness in  w.iich  any  one  of  them  has  any  important  pecuniary 
interest.  Such  a  law,  well  enforced,  would  prevent  the  major- 
ity of  bank  failures,  and  work  no  hardship  to  any  one.  If  the 
security  is  good,  the  bank  officer  could  obtain  the  loan  else- 
where. If  it  is  not  good,  ho  ought  not  to  expect  it.  Nearly 
all  bad  bank  failures  occur  as  a  result  of  loans  to  bank  officers. 


THE  FARMER  AND  THE  BANKER.  133 

There  is  no  state  in  which  the  Legislature  would  not  comply 
with  a  demand  from  farmers  to  pass  a  proper  law,  and  no  class 
but  the  farmers  is  ever  likely  to  move  in  the  matter.* 

It  is  conclusive  evidence  of  the  integrity  and  sound  judg- 
ment of  bank  officers  that  so  few  bank  failures  occur,  and  this 
leads  to  the  point  which  I  wish  specially  to  emphasize  in  this 
chapter,  which  is  that  the  president  of  a  country  bank  is  the 
very  best  friend  that  a  farmer  can  have,  when  he  becomes 
financially  embarrassed,  or  when  about  to  engage  in  any 
enterprise  involving  debt.  By  virtue  of  his  position,  the 
president  of  the  bank  must  be  a  good  judge  of  what  will  and 
what  will  not  pay.  If  he  is  not  such  a  judge,  the  bank  will 
lose  its  money  in  bad  loans.  If  the  farmer  finds  his  creditors 
pressing  him,  the  bank  president  is  the  best  man  in  the  world 
to  advise  him  whether  he  can  probably  pay  his  debts,  or 
whether  he  had  better  give  up  and  compromise,  and,  if  he  can 
pay,  to  help  him  to  the  money  or  extensions.  As  a  rule,  the 
president  of  a  country  bank  knows  pretty  well  the  circum- 
stances of  the  people  in  his  vicinity,  and  what  margin  of  profit 
there  is  in  the  business  carried  on.  He  is  in  contact  with  all 
who  handle  any  considerable  sums  of  money,  and  the  ebb  and 
flow  of  deposits  in  his  bank  is  an  almost  perfect  index  of  the 
prosperity  of  the  community.  He  knows  whether  those 
engaged  in  the  different  industries  are  making  money,  and 
hence  whether  it  is  safe  to  borrow  money  to  engage  in  them, 
or  whether,  if  one  is  already  seriously  involved,  there  is  a 
prospect  of  winning  out.  It  is  this  knowledge  which  farmers 
can  seldom  ])Ossess,  wdiich  makes  him  the  best  adviser  that  the 
farmer  can  have. 

There  is  some  disposition  among  farmers  to  regard  "banks" 
as  their  natural  enemies.  The  foundation  for  this  feeling  is 
doubtless  the  fact  that  money  borrowed  from  a  bank  is 
expected  when  due.  Farmers,  in  their  dealings  among  them- 
selves, and  with  tradesmen,  are  not  accustomed  to  make  pay- 
ments with  such  promptness,  and  are  inclined  to  resent  the 
enforcement  of  such  rules   against  them.     If,  however,  the 


*  In  some  states,  at  least,  savings-banks  are  prohibited  from  loaning  to  tlieir 
officers. 


134  THE    FARMER    AS    A    BUSINESS    MAN. 

same  farmers  become  prosperous,  and  deposit  their  surplus  in 
savings-banks,  or  possibly  buy  a  little  bank  stock,  they  are 
quite  sure  to  prom[)tly  call  for  their  dividends  upon  the  first 
of  January  and  July,  and  to  roundly  blame  the  management 
if  they  are  not  satisfactory.  Throughout  the  country  there 
are  thousands  of  poor  people  whose  little  all  is  invested  in 
savings-banks,  and  who  depend  for  their  means  of  living  upon 
the  regular  dividends.  These,  however,  can  not  be  paid  unless 
debts  due  to  the  banks  are  promptly  met.  In  the  main  the 
money  of  the  banks,  and  especially  of  country  banks,  is  owned 
by  comparatively  poor  people,  whose  small  deposits,  when 
combined,  form  the  capital  which  is  available  for  loaning. 
When,  therefore,  farmers  denounce  "banks,"  they  attack,  for 
the  most  part,  poor  people  like  themselves.  It  is  true  that  in 
large  cities  tliere  are  large  financial  institutions  which  control 
great  blocks  of  accumulated  capital  owned  by  capitalists. 
These,  also,  have  their  functions,  which  it  would  require  a 
volume  to  intelligently  explain  and  discuss.  They  are  essen- 
tial to  society  as  it  exists.  Without  them  the  great  financial 
operations  of  the  age  would  be  impossible.  They  loan  great 
sums  of  money  at  low  rates,  upon  unimpeachable  security.  It 
is  through  them  that  governments  and  large  municipalities 
borrow  money  in  time  of  need,  and  that  the  great  railroad  and 
other  corporations  float  their  indebtedness.  They  are  not 
themselves  "monopolists,"  but  they  supply  the  means  by 
which  only  are  "monopolies"  possible.  Their  function  is 
limited  to  collecting  and  fending  great  sums  of  money  at  very 
low  and*  constantly  decreasing  rates  of  interest.  By  this  tax- 
ation is  reduced,  as  well  as  the  cost  of  service  in  all  the  most 
important  departments  of  life,  and  they  thus  render  a  service 
to  society.  So  far  as  these  loans  are  made  to  the  public, 
society  at  large  is  a  direct  gainer,  because  it  borrows  money 
in  amounts  and  at  rates  which  would  be  unattainable  without 
the  agency  of  these  institutions.  In  lending  money  these 
concerns  make  the  best  terms  possible  for  themselves,  just  as 
the  farmer  does  in  selling  his  products.  If  loanable  capital 
at  any  time  happens  to  be  scarce,  those  who  have  it  will  set 
their  own  price  to  those  who  are  in  great  need  of  it,  just  as  the 


THE  FARMER  AND  THE  BANKER.  135 

farmer  will  not  take  less  than  $20  per  ton  for  his  hay  if  he  can 
get  it,  although  he  knows  that  his  neighbor  who  buys  it  can 
not  afford  to  pay  SIO  per  ton.  Perhaps  neither  ought  thus  to 
take  advantage  of  necessity,  but  both  will  do  so  when  they  get 
the  chance.  But  in  the  long  run  the  great  capitalist  must 
lend  money  at  low  rates  just  as  in  the  long  run  the  farmers 
must  sell  hay  at  low  rates.  The  price  of  money  and  of  hay 
is  determined  by  the  profits  which  can  be  made  from  their 
use,  and  profits  are  constantly  decreasing.  When,  instead  of 
dealing  directly  with  government,  capitalists  lend  at  low  rates 
to  corporations,  the  loan  is  a  service  to  society,  because  it 
cheapens  commodities  or  service.  Those  who  have  borrowed 
the  money,  and  taken  the  risk,  will,  if  they  can,  secure  the 
whole  of  this  benefit  to  themselves,  giving  the  public  no 
advantage  whatever,  and  even,  if  possible,  increasing  the 
public  burden.  As  a  rule  they  can  not  do  this,  the  public 
usually  deriving  some  benefit  from  the  cheap  money,  no  matter 
who  the  borrower  may  be.  The  public,  however,  knowing  that 
power  will  be  abused  so  far  as  it  can  be,  is  always  on  the 
watch,  and  is  never  satisfied  with  its  share,  even  when,  if  it 
knew  all  the  facts,  it  would  be.  There  is,  therefore,  the  chronic 
and  increasingly  bitter  warfare  between  the  public  and  the 
"monopolies."  This  is  a  grave  subject,  discussed  elsewhere  in 
this  volume.  It  is  hardly  a  question  between  the  farmer  and 
the  banker. 

Hitherto  banks  have  been  considered  as  if  all  of  one  class, 
differing  only  in  size  and  importance.  As  is  well  known, 
however,  there  are  two  general  classes  of  banks,  known  as 
"commercial"  and  "savings"  banks.  Commercial  banks 
receive  deposits  subject  to  check  at  sight,  and  to  assure  the 
ability  to  always  pay  on  demand  they  are  restricted  by  law  to 
short-time  loans,  and  required  to  always  keep  on  hand,  in 
cash,  a  certain  portion  of  their  deposits.  Money  deposited  in 
savings-banks  is  not  subject  to  check.  The  amounts  as  depos- 
ited are  entered  in  a  depositor's  book,  and  can  be  withdrawn 
only  upon  presentation  of  the  book,  after  due  notice  as  required 
by  the  law  of  the  state  and  the  regulations  of  the  bank,  the 
time  varying  from  thirty  days  to  six  months.     As  a  matter  of 


136  THE    FARMER    AS    A    BUSINESS    MAN. 

fact,  deposits  may  usually  be  withdrawn  without  notice,  but 
the  bank  has  the  right  to  require  notice.  The  reason  of  this 
is  obvious.  Savings-banks  are  created  to  lend  money  on  long 
time,  and  for  the  most  part  on  landed  security.  Deposits  are 
made  in  order  that  they  may  be  so  loaned,  and  in  that  way 
earn  interest.  There  is  usually  no  requirement  for  a  "reserve" 
sufficient  to  pay  deposits  upon  demand.  In  times  of  panic, 
however,  there  is  usually  no  sale  for  land,  or  for  securities 
based  upon  it.  Savings  depositors  are,  to  a  large  extent,  poor 
people,  easily  excited,  and  quite  prompt  to  demand  their 
money  if  they  think  they  can  not  get  it.  And  yet  they  all 
know  that  their  money  has  been  lent,  and  is  for  the  most  part 
out  of  the  bank's  control.  They  do  not,  however,  reason  upon 
this,  but  simply  demand  their  money.  Under  such  circum- 
stances the  bank,  if  it  can,  takes  its  mortgages  to  some  large 
financial  institution  and  borrows,  upon  them,  the  money  to 
pay  off  the  depositors  whose  money  is  invested  in  them.  If  it 
can  not  do  this  it  closes  its  doors  and  goes  into  "liquidation." 
Tlie  money  loaned  out  is  collected  by  the  "receiver"  as  rapidly 
as  possible,  and  returned  to  depositors,  less  expenses.  It  is  a 
long,  tedious,  and  expensive  operation,  and  depositors  get 
back  but  a  portion  of  their  money.  A  " run"  upon  a  savings- 
bank  is  one  of  the  silliest  of  things.  Depositors  who  make  it 
are  really  making  a  run  upon  themselves.  Of  course  savings- 
banks  do  sometimes  loan  money  unwisely  and  so  fail.  This 
is  a  risk  that  depositors  must  take.  As  a  rule  the  money  is 
wisely  invested,  and  is  safe  with  time  given  for  collections 
Farmers  who  have  borrowed  money  dislike  extremely  to  have 
their  mortgages  foreclosed.  They  can  hardly  dislike  it  more 
than  bank  officers.  No  foreclosure  takes  place  wdien  the  mort- 
gagor can  sell  the  pro])erty  for  enough  to  pay  the  loan.  In 
case  of  foreclosure  the  bank  nearly  always  has  to  take  the 
property.  Having  no  use  for  land  or  any  machinery  for 
successfully  managing  it,  banks  are  less  likely  to  get  interest 
and  expenses  from  it  than  the  former  owners.  They  never 
foreclose  until  satisfied  tiiat  the  mortgagor  can  not  pay.  When 
that  is  the  case,  the  quicker  the  foreclosure  is  made  the  better 


THE  FARMER  AN'D  THE  BANKER.  137 

for  the  farmer.  lie  is  put  out  of  tlie  misery  of  struggling  to 
accomplish  the  impossible. 

Bank  checks  and  drafts*  form  the  main  part  of  the  money 
of  the  world.  While  they  are  not  money,  their  use  enables 
society  to  dispense  with  most  of  the  money  which  would 
otherwise  be  required.  They  are  used  instead  of  money 
because  they  are  more  convenient.  In  the  large  cities  fully 
ninety-five  per  cent  of  the  payments  are  made  by  means  of 
these  instruments.  In  the  smaller  towns  the  ratio  is  less,  and 
among  farmers  actual  money  is  probably  used  more  than 
checks.  The  existing  stock  of  money  at  its  present  valuation 
would  go  but  little  way  towards  transacting  the  business  of 
the  world,  and  if  used  would  be  very  inconvenient  and 
expensive.  In  times  of  panic  the  greatest  effect  is  the  stop- 
page of  the  flow  of  bank  checks  and  drafts.  It  is,  of  course, 
not  true  that  modern  society  could  not  exist  without  banks, 
but  it  could  not  do  business  in  the  way  business  is  done  now, 
nor  so  conveniently  and  cheaply.  This  subject,  however,  has 
been  sufficiently  discussed  elsewhere  in  this  volume.f 

There  is  one  function  of  the  bank  yet  to  be  considered — 
that  of  issuing  paper  money.  In  all  new  countries  which 
can  not  attract  gold  and  silver  because  they  have  little  to  sell, 
there  is  a  demand  for  something  which  will  serve  as  currency. 
To  supply  this  demand  there  are  three  courses  open,  all  of 
which  have  been  eni[)loyed  in  the  United  States;  the  first 
is  the  acceptance  of  some  commodity  as  money,  wampum, 
cattle,  or  tobacco;  the  second,  the  emission  of  promises  to  pay 
money  by  the  government;  the  third,  the  emission  of  promises 
to  pay  money  by  banks,  duly  authorized  thereto. 

This  general  subject  has  been  fully  treated  elsewhere,t 
the  discussion  of  the  latter  alternative,  issues  of  bank-notes, 
being  reserved  as  more  appropriate  in  this  place.  During  the 
period   between  the  close  of  the  Revolutionar}^  War  and  the 


*A  "draft  may  be  roughly  described  as  any  order  for  money  other  than 
one  drawn  by  an  individual  upon  a  bank  in  which  he  has  a  deposit. 

I  Book  sixth,  chapter  IV, 


138  THE    FARMER    AS    A    BUSINESS    MAN. 

beginning  of  the  Civil  War,  bank-notes  were  in  universal  use 
in  this  country,  forming  practically  the  only  currency,  except, 
after  1849,  on  the  Pacific  Coast.  No  bank  can  issue  paper 
money  except  as  authorized  by  law,  and  the  laws  which 
authorize  the  banks  to  exercise  this  function  always  prescribe 
conditions  which  are  presumed  to  assure  the  redemption  of  the 
notes  in  coin,  on  demand,  at  the  counter  of  the  bank  which 
issues  them.  In  the  wealthier  states  of  the  east  these  laws 
were  fairly  well  framed  and  enforced,  and,  as  a  matter  of  fact, 
did,  as  a  rule,  assure  the  redemption  of  notes  on  })resentation, 
except  in  times  of  the  occasional  "panics"  against  which 
probably  no  legislation  whicli  will  permit  bank-notes  to 
circulate  at  all,  can  be  effective.  A  bank  which  is  required  to 
keep  on  hand  such  a  coin  reserve  as  will  enable  it  to  pay  off 
nearly  all  its  outstanding  notes  at  once,  would  liave  no  motive 
to  issue  the  notes,  and  would  not  do  so.  Any  country  whose 
currency  is  mainly  bank-notes  must  expect  a  general  suspen- 
sion of  specie  payments  in  times  of  panic.  But  while,  during 
our  period  of  bank  currency,  the  laws  of  most  eastern  states 
assured  the  redemption  of  bank-notes  in  most  cases,  such  laws 
in  the  then  western  states  would  have  prevented  the  issuance 
of  any  bank-notes.  In  those  states  there  was  almost  no  coin, 
because  there  was  nothing  to  exchange  for  it  except  land,  and 
those  who  had  the  coin  did  not  want  the  land,  or  if  they  did, 
could  obtain  it  without  coin.  Any  law,  therefore,  which 
required  coin  reserves  even  sufficient  for  ordinary  purposes, 
much  more  for  stability  in  times  of  trial,  could  not  have  been 
complied  with.  "Money,"  however,  of  some  kind,  the  people 
must  have  or  they  could  not  speculate,  and  speculation  was 
the  one  thing  which  they  were  determined  to  engage  in.  The 
Legislatures,  therefore,  permitted  banks  to  issue  notes  without 
any  adequate  provision  for  their  redemption  in  coin.  In  most 
cases  the  notes  were  supposed  to  be  secured  by  bonds  or  other 
securities,  usually  based  on  land  and  exchangeable  for  coin 
only  in  case  the  lands  could  be  sold  for  coin,  which  every- 
body knew  was  impossible.  It  was  a  time  when  banks  w^ere 
organized  by  special  charters  rather  than  under  general  laws, 
and  many  of  these  charters  were  so  loosely  drawn  as  to  make 


THE    FARMER    ANT)    TITE    RANKER. 


139 


the  way  easy  for  all  iiiainier  of  frauds,  and  cheerfully  passed 
by  Legislatures,  sometimes,  doubtless,  corrupt,  but  for  the  most 
part  only  ignorant.  The  result  was  a  sudden  abundance  of 
what  was  called  money,  but  which  had  little  or  no  value 
except  in  the  imagination  of  the  community.  When  people 
ceased  to  believe  it  to  be  money,  as  they  did  whenever 
presented  in  any  quantity  for  redemption,  according  to  its 
promise,  it  ceased  to  be  money.  This  is  known  as  the  era  of 
"  wild-cat "  money,  and  is  one  of  the  picturesque  eras  of 
financial  history.  Men  were  rich  one  day  and  paupers  the 
next.  Bank-bills  passed  from  hand  to  hand,  with  little  or  no 
knowledge  of  their  value,  the  shrewder  sort  carefully  retaining 
the  bills  of  such  banks  as  they  believed  to  be  strongest,  and 
paying  out  the  shaky,  the  worst  of  all  invariably  finding  their 
way  to  the  poorest  and  most  ignorant,  who  lost  all  when  the 
crash  came.  Whenever  there  is  a  debasement  of  the  currency, 
it  is  the  poorest  who  suffer  most.  The  above  is  a  fair 
description  of  the  condition  of  our  bank  currency  as  it  existed 
prior  to  1837,  in  which  year  occurred  the  worst  financial  panic 
in  our  history.  The  majority  of  western  banks  went  out  of 
existence,  and  the  people  who  held  their  notes  lost  them. 
There  was  the  same  necessity  for  money,  however,  and  grad- 
ually new  banks  were  formed  or  old  ones  reestablished,  and 
tlie  issues  began  again.  Wealth,  however,  had  been  grad- 
ually crteping  west,  and  it  was  now  possible  for  some  banks, 
especially  in  the  larger  places,  to  give  real  security  for  mod- 
erate issues  of  notes;  and,  taught  by  experience,  legislation 
became  gradually  more  stringent  in  all  the  states.  Specula- 
tion started  up,  although  less  wildly  than  before,  followed  by 
another  panic  in  1857.  Again  banks  went  down,  with  the 
same  unhappy  consequences  to  poor  men,*  but  the  prostration 
was  not  so  complete  as  in  1837.  By  1860  the  country  had 
pretty  much  recovered  from  the  shock. 


*  Of  course  in  all  panics  llic  rich  and  well-to-do  suffer  losses,  but  they  come 
rather  in  the  form  of  loss  of  deposits  than  loss  upon  currency.  The  wealthy 
keep  comparatively  little  money  by  them,  it  being  their  custom  to  deposit  in 
banks.     It  is  mainly  the  poor  who  lose  directly  by  a  depreciated  currency. 


140  THE   FARMER   AS   A   BUSINESS   MAN. 

The  breaking  out  of  the  Rebellion  caused  an  immediate  and 
complete  change  in  the  character  of  our  bank-notes,  and  in 
place  of  the  issues  of  uncertain  and  fluctuating  value,  circulat- 
ing locally  and  constantly  counterfeited,  we  obtained  a  uni- 
form bank  currency,  circulating  freely  at  par  in  all  parts  of 
the  United  States,  and  by  which  no  man,  rich  or  poor,  has 
ever  yet  lost  a  dollar  by  failure.  The  change  was  marvelous,  and 
was  completed  in  a  few  months.  The  operation  was  natural 
and  very  simple.  At  that  time  the  privilege  of  issuing  notes 
to  serve  as  currency  was  considered  of  great  value.  By  retain- 
ing in  its  vaults  $15,000  to  $25,000  in  coin  for  redemption,  a 
bank  could  issue  notes  to  the  amount  of  $100,000,  which  it 
could  loan.  Its  profit  was  the  interest  on  the  amount  of  dif- 
ference between  the  face  of  the  issue  and  the  coin  kept  for 
redemption.  If  the  reserve  was  faithfully  maintained,  and  the 
loans  made  with  common  prudence,  the  currency  was  safe 
under  all  ordinary  conditions.  At  this  time  the  national  gov- 
ernment was  in  great  need  of  money,  and  its  credit  was  very 
low.  If  some  means  could  be  found  to  induce  a  strong  demand 
for  United  States  bonds  from  the  banks  of  the  country,  it  would 
be  greatly  to  the  advantage  of  the  nation.  The  Secretary  of  the 
Treasury  therefore  proposed  to  give  such  banks  as  would  buy 
United  States  bonds  the  exclusive  privilege  of  issuing  bank- 
notes. Congress  approved  the  suggestion,  and  the  result 
was  the  National  Bank  Act,  which,  with  few  modifications, 
still  stands.  The  principle  of  that  act  is  this:  In  the  first 
place  the  bank  lends  the  United  States,  let  us  say,  $100,000. 
It  deposits  the  bonds  thus  received  in  the  Treasury  of  the 
United  States  as  security  for  any  notes  which  it  may  issue. 
The  Treasury  then  causes  notes  to  be  printed  and  delivered  to 
the  bank  to  the  amount  of  $90,000.  These  notes  are  not  legal 
tender,  but  they  are  payable  on  demand,  either  in  coin  or  in 
United  States  notes,  which  are  legal  tender.  For  the  redemp- 
tion of  these  notes  on  demand,  the  bank  must,  in  most  ])laces, 
retain  15  per  cent  of  the  amount  issued  either  in  coin  or  legal 
tender  notes.*  The  bank's  outlay  is  $100,000,  lent  to  the  govern- 


*National  banks  in  the  large  cities  must  retain  25  per  cent  of  deposits. 


THE  FARMER  AND  THE  RANKER.  141 

ment,  upon  which  it  dmws  interest,  and  $15,000  retained  in  its 
vaults  for  redemption.  Its  profit  is  tlie  interest  upon  $75,000  to 
$85,000,  provided  it  can  keep  that  amount  constantly  loaned. 
It  pays  to  the  government  an  annual  tax  of  one  per  cent  on 
its  currency  in  actual  circulation.  The  national  banks  are 
assured  of  a  monopoly  of  the  privilege  of  issuing  bank-notes 
b}'-  means  of  a  tax  of  ten  per  cent  per  annum  ui)on  all  issues  of 
state  banks.  This  tax  renders  the  business  of  issuing  notes 
unprofitable,  and  as  soon  as  the  tax  was  levied,  all  state  bank- 
notes were  called  in.  In  case  of  failure  of  a  national  bank  its 
outstanding  notes  are  redeemed  by  the  government  from  the 
proceeds  of  the  bonds  deposited  as  security,  thus  making  them 
absolutely  safe.  Under  the  state  bank  system  nearly  every 
note  issued  was  successfully  counterfeited,  and  the  loss  to  the 
public  from  this  cause  was  very  great.  The  notes  on  an  Ohio 
bank  might  be  counterfeited  in  New  York,  and  put  in  circula- 
tion in  Iowa.  If  the  counterfeiter  was  not  detected  at  the  place 
of  issue,  he  would  probably  never  be  caught,  and  if  arrested, 
the  "  plant "  for  counterfeiting  could  seldom  be  located.  The 
work  of  detecting  and  punishing  these  criminals  was  wholly  in 
the  hands  of  the  state  authorities,  who  found  it  very  difficult  to 
pursue  criminals  beyond  their  own  boundaries.  Enterprising 
persons  published  "  counterfeit  detectors,"  which  were  issued 
weekly  or  oftener,  and  were  at  the  elbow  of  every  one  who 
handled  money  in  any  great  cjuantity.  No  one  would  receive 
a  bank  bill  from  a  stranger  without  consulting  the  last  num- 
ber of  his '' detector  "  to  ascertain  whether  that  bill  had  been 
counterfeited,  and,  if  so,  as  was  usually  the  case,  to  obtain  a 
description  of  the  counterfeit.  Every  bank  had  its  "  rating," 
that  is,  the  rate  at  which,  if  at  all,  its  bills  would  be  received 
for  deposit  by  New  York  banks.  None  outside  that  city  were 
taken  at  par,  a  sufficient  discount  being  always  taken  to  pay 
for  cost  of  collection;  all  country  notes  reaching  New  York 
being  promptly  returned  to  the  bank  of  issue  for  redem})tion. 
The  strongest  banks  maintained  redemption  agencies  in  the 
principal  cities,  thus  maintaining  the  credit  of  their  notes. 
The  notes  of  the  weaker  country  banks  were  at  various  rates  of 
di.scount  in  the  large  cities,  and  brokers  did  a  thriving  busi- 


142  THE    FARMER    AS    A    BUSINESS    MAN. 

iiess  in  buying  them  and  sending  them  home.     No  prosperous 
nation  ever  had  so  bad  a  currency. 

The  passage  of  tlie  National  Bank  Act  was  a  great  blessing. 
The  people,  for  the  first  time  in  their  history,  had  a  stable  and 
perfectly  secure  bank  circulation,  for  whose  redemption,  on 
demand,  the  faith  of  the  country  was  pledged,  and  which  cir- 
culated at  par  with  United  States  notes  in  all  parts  of  the 
countr}^  The  government  got  large  sums  of  money,  of  which 
it  was  greatly  in  need,  and  the  banks  made  money  very 
rapidly.  There  was  an  active  demand  for  loans  at  good  rates 
of  interest,  so  that  the  bank  issues  were  kept  constantly  earn- 
ing money,  and  there  was  interest,  paid  in  gold,  on  the  bonds 
deposited  as  security.  It  has  been  thought  that  the  banks 
made  too  much  money.  Doubtless  they  did,  but  without  the 
prospect  of  great  profits  the  bonds  could  not  have  been  sold  to 
the  banks,  and  the  government  would  not  have  got  the  money 
which  it  needed  so  badly.  The  nation  was  in  distress  and  had 
to  pay  roundly  for  loans,  just  as  an  individual  in  distress  has 
to  do  to-day.  A  money  lender  will  show  no  more  considera- 
tion than  a  tradesman  or  a  farmer.  All  will  get  the  highest 
price  possible  for  wliat  they  have  to  sell.  Even  at  the  rate  of 
profit  which  the  banks  were  making,  public  sentiment  regarded 
their  bond  subscriptions  as  acts  of  lofty  patriotism.  It  was  a 
common  feeling  at  the  time  that  the  government  could  get 
men  easier  than  it  could  get  money,  and  the  citizen  who 
invested  in  government  bonds  was  regarded  as  only  less  patri- 
otic than  he  who  shouldered  a  musket  and  went  to  the  field. 
It  was  recognized  that  there  was  some  risk  in  taking  govern- 
ment bonds  at  that  time.  We  were  not  then  the  rich  and 
united  people  wiiich  w^e  have  since  become.  We  were  a  dis- 
tracted nation,  struggling  in  the  throes  of  what  at  times  seenied 
to  be  dissolution.  That  tlie  bonds  would  be  paid  sometime 
was  believed.  Except  for  tliat  belief  they  could  not  liave 
been  sold  at  all;  but  when  they  would  be  paid,  or  in  what  kiml 
of  currency,  there  was  grave  doubt  in  the  minds  of  many, 
regardless  of  the  covenant  to  pay  in  "  coin."  The  magnificent 
recuperative  power  shown  by  our  united  country  could  not  be 
foreseen,  nor  was  it  anticipated  by  any  one.     As  a  result  of  it, 


THK    FAR.MKR    AND    TlIK    ]'.AM<EK.  143 

however,  the  national  banks  profited  enormously.  Their 
bonds  doubled  in  value,  while  all  the  time  paying  six  per  cent 
interest  in  gold,  in  addition  to  the  profit  on  circulation.  They 
paid  for  the  bonds  all  that  the  government  could  get  from  any 
one  else,  in  many  cases  unquestionably  as  a  patriotic  duty,  and 
they  turned  out  a  bonanza.  The  result  of  all  this  has  been  a 
very  bitter  feeling  on  the  part  of  the  farming  community 
towards  the  national  banks.  They  are  commonly  spoken  of  as 
leaches  who  sucked  the  life-blood  of  the  nation  in  the  hour  of 
its  extremity.  There  is  no  foundation  for  this  opinion.  The 
bankers  "were  quite  as  patriotic  as  otliers.  During  the  Rebel- 
lion many  farmers  invested  their  savings  in  government  bonds, 
often,  as  in  the  case  of  many  bankers,  from  patriotic  motives. 
They  paid  only  the  current  market  price  for  them,  just  as  the 
bankers  paid,  nor  w^ould  they  have  paid  more.  Had  they 
kept  them  they  would  have  made  the  same  profit  that  the 
bankers  made.     Very  few  of  them,  however,  did  so. 

The  punishment  which  it  is  pro|)osed  to  visit  upon  the 
national  banks  of  to-day  for  the  alleged  sins  of  their  prede- 
cessors of  a  generation  ago  is  to  deprive  them  of  the  privilege, 
or  at  least  the  exclusive  privilege,  of  issuing  circulating  notes. 
It  is  true  that  the  majority  of  those  who  hold  these  views, 
hold  them  as  their  views  of  a  proper  fiscal  policy,  but  the 
alleged  extortions  of  former  days  are  the  n^ain  arguments 
used  to  fire  the  popular  heart  and  arouse  to  action.  In  fact,  it 
is  a  popular  belief  that  the  national  banks  are  still  in  receipt 
of  the  enormous  profits  which  they  formerly  made.  This 
belief  is  held  by  so  many  of  our  people  that  the  question  of 
continuing  our  present  bank  circulation  is  in  some  measure  a 
"question  of  the  day."  Its  proper  consideration  raises  two 
questions:  First,  do  the  national  banks  now  nnike  an  undue 
profit  from  their  circulation?  Second,  is  or  is  not  our  present 
national  bank  currency  safer,  and,  therefore,  more  desirable 
for  the  people,  than  state  bank-notes,  or  government  notes. 
Let  us  consider  these  questions  in  their  order. 

The  national  banks  do  not  now  make  an  undue  profit  on 
their  circulation.  It  depends  upon  circumstances  whether  they 
make  any  profit  at  all.     As  a  matter  of  fact,  many  banks  can 


144  THE    FARMER    AS    A    BUSINESS    MAN. 

make  no  profit,  and  have  withdrawn  their  circulation,  while 
remaining  national  banks.  Few,  if  any,  of  the  large  banks 
which  some  people  would  like  specially  to  reach,  care  any- 
thing about  the  matter.  The  wealth  of  the  country  has  so 
increased  that  deposits  furnish  about  all  the  loanable  capital 
which  can  be  profitably  employed.  In  times  of  stringency  or 
panic,  when  deposits  are  withdrawn  and  hoarded,  it  would  be 
profitable  to  the  banks,  and  convenient  for  the  public,  to  be 
able  to  loan  their  own  notes.  During  the  years  following  1893 
many  national  banks  which  had  withdrawn  or  reduced  their 
circulation,  drew  out  new  currency  to  be  applied  to  this 
purpose.  Doubtless  it  was  profitable,  or  it  would  not  have 
been  done.  But  it  was  also  very  convenient  for  borrowers. 
The  reasons  for  this  changed  condition  are  quite  obvious.  In 
the  first  place,  government  bonds  no  longer  bear  six  per  cent 
interest  but  three  per  cent.  Most  banks  can  make  more  than 
three  per  cent  upon  money,  and  whatever  more  they  could 
make  is  a  loss  if  they  lend  to  the  government  at  that  rate. 
Let  us  see  how  the  account  stands  in  the  case  of  a  national  bank 
issuing  its  own  notes.  It  deposits  in  the  treasury  $100,000  in 
bonds,  upon  which  it  receives  three  per  cent  interest.  Upon 
this  security  the  bank  is  permitted  to  issue  notes  to  the  amount 
of  $90,000.  The  account  would  then  stand,  assuming  that  the 
entire  issue  is  loaned: — 

Outlay: 

Bonds  $100  000 

Income : 

Interest  on  bonds    $3,000 

Interest  on  $90,000  notes,  6%  . . . .   5,400 

$8,400 
Less  tax  on  circulation  (1  per  cent)       900 

Total  income   $7,500 

In  this  computation  I  luive  assuuied  the  rate  of  interest  on 
circulation  loaned  to  be  six  per  cent,  which  is  probably  a  fair 
average  rate  for  the  country,  and  also  that  the  entire  issue  of 


THE  FARMER  AND  THE  BANKER.  145 

notes  is  kept  constantly  at  interest,  which  would  seldom  be  the 
case.  Upon  these  assumptions  there  is  a  revenue  of  seven 
and  one-half  per  cent,  less  expenses  of  conducting  the  busi- 
ness and  occasional  losses  which  no  bank  can  avoid.  The 
stockholders  could  not  possibly  receive  much  over  six  per  cent 
dividends,  which  would  be  satisfactory  but  not  exorbitant. 
I  have  also  assumed  that  the  banks  purchase  the  bonds  at 
par,  which  they  could  not  do.  United  States  three  per  cent 
bonds,  at  the  time  I  write,  are  at  a  premium  of  thirteen  per 
cent,  at  which  rate  they  pay  about  two  and  six-tenths  per  cent 
interest.  In  the  large  cities,  also,  the  majority  of  bank  loans 
are  made  at  much  less  than  six  per  cent — three  and  one-half 
to  four  and  one-half  per  cent  being  the  ruling  rate  in  New 
York  as  I  write.  It  is  therefore  obvious  that  there  might 
easily  be  a  loss  instead  of  a  profit  on  circulation  under  the 
terms  of  the  National  Bank  Act,  which  explains  why  so  many 
national  banks  issue  no  notes.  The  small  country  banks, 
loaning  in  a  more  retail  way,  get  higher  rates  of  interest,  but 
they  could  also  get  higher  rates  for  the  money  which  they 
have  loaned  to  the  government  as  security  From  all  this  it 
should  be  evident  that,  taking  the  banks  together,  the  majority 
care  very  little  about  the  privilege  of  issuing  notes  under  the 
terms  of  the  Bank  Act  as  it  stands.  To  some  there  is  doubtless 
a  reasonable  profit  or  no  notes  would  remain  in  circulation. 
This  leaves  us  free  to  discuss  the  second  question,  whether 
it  is  for  the  general  interest  to  retain  the  national  bank  circu- 
lation. The  public  convenience  demands  a  paper  circulation 
of  some  kind,  and  if  we  eliminate  the  national  banks,  there 
remains  only  the  alternative  of  state  banks  or  government 
issues.  No  one  who  remembers  our  former  state  bank  cur- 
rency will  seriously  consider  the  first  alternative.  While  we 
should  not  again  have,  under  a  state  bank  system,  any  such 
wretched  currency  as  we  had  previous  to  1860,  it  could  not  be 
made  a  good  one.  The  state  laws  would  be  made  far  more 
favorable  to  banks  than  the  national  act,  and  in  some  states 
the  laws  would  certainly  be  very  lax.  There  would  be  some 
weak  banks,  and  their  notes  would  almost  certainly  be  found 
mainly  in  the  hands  of  poor  people  when  they  failed,  as  the 
10 


146  THE    FARMER    AS    A    BUSINESS    MAN. 

wealthy  would  be  better  informed  about  them  and  not  take 
them.  There  would  be  more  counterfeiting,  and  there  would  not 
be  the  aid  of  the  exceedingly  efficient  secret  service  with  which 
the  United  States  Treasury  protects  national  government  inter- 
ests. The  notes  would  assuredly  not  circulate  at  par  in  all 
parts  of  the  country.  As  no  reversion  to  this  system  is  likely 
to  be  seriously  considered,  sufficient  has  been  said  on  this 
subject. 

Another  measure  proposed,  and  what  has  found  much 
favor  in  banking  circles,  is  that  the  privilege  of  issuing  paper 
currency  should  be  given,  exclusively,  to  national  banks, 
under  government  regulation  and  supervision,  the  entire  assets 
of  all  banks  to  be  security  for  the  redemption  of  the  notes  of 
all  banks,  and  a  redemption  fund  to  be  provided  by  an 
annual  tax  on  circulation. 

This  would  certainly  give  an  "elastic"  currency,  as  banks 
would  extend  and  contract  their  circulation  according  to  the 
demand  for  loans.  A  large  body  of  people  object  to  it  in  the 
belief  that  bankers  would  combine  to  withdraw  circulation  for 
the  purpose  of  raising  rates.  While  this  would  not  be  very 
likely,  the  popular  fear  of  it  will  probably  prevent  its  adoption 
in  the  near  future.  There  is  also  an  objection  to  the  measure 
on  the  part  of  some  strong  banks  who  will  object  to  l)e  bound 
to  aid  in  the  redemption  of  weak  banks  except  under  condi- 
tions to  which  the  latter  would  object.  It  is  not  impossible 
that  this  proposal  may  become  the  subject  of  active  popular 
discussion,  but  it  has  not  yet  become  so. 

The  question  then  remains  whether  the  general  interests 
of  the  country  will  be  best  served  by  national  bank-notes  or 
government  issues.  This  is  a  topic  debated  with  some  })assion. 
It  is  claimed  by  those  favoring  government  issues  only  some- 
what as  follows : — 

1.  That  it  is  necessary  to  restrict  the  great  power  of  the 
banks. 

The  answer  to  this  is,  as  already  shown,  that  depriving 
them  of  the  exclusive  privilege  of  issuing  notes  under  present 
conditions  would  affect  them  but  very  little. 

2.  That  the  government  would  save  the  interest  upon  the 


TlIK    FARMER    AND    THE    BANKER.  147 

amount  of  the  currency  issued,  less  expense  of  administration 
— say  a  net  saving  of  two  and  three-fourths  per  cent.  This 
would  amount,  upon  the  amount  of  the  national  bank  cur- 
rency extant  at  the  present  time  ($238,109,059),  to  $G,547,99N 
annually. 

This  is,  of  course,  true.  The  question  then  remains — and 
it  is  the  only  question  of  importance  in  this  connection — 
whether  there  is  an  indirect  gain  to  the  nation  through  employ- 
ing the  national  banks  in  this  service,  sufficient  to  overbalance 
this  possible  direct  saving  of  interest.  The  indirect  benefit 
derived  at  the  beginning  of  the  system — that  of  finding  a 
market  for  its  bonds — is,  of  course,  no  longer  of  any  conse- 
quence to  the  government,  any  more  than  the  issuing  of  notes 
under  the  restrictions  of  the  present  act  is  of  much  consequence 
to  the  banks.  The  indirect  benefit,  if  it  exists,  must  be  sought 
elsewhere. 

As  to  this,  those  who  favor  national  bank  issues  claim 
that  those  issues,  as  well  secured  as  under  the  present  act^ 
are  preferable  to  any  issue  of  government  paper  money,  in 
three  respects: — 

1.  The  bank  issues  are  safer. 

This  sounds  queerly,  and  is  likely  to  shock  emotional 
patriots,  but  it  is  true,  for  the  reason  that,  in  addition  to  the 
security  of  the  bonds,  the  property  of  the  banks  may  be 
attached  and  sold,  while  the  property  of  the  government  can 
not.  In  case  the  United  States  should  pay  off  its  debt,  which 
it  is  quite  likely  to  do,  if  we  escape  further  war  for  some  years, 
it  has  been  authoritatively  proposed,  by  a  workable  plan  alread}^ 
alluded  to,  to  make  all  the  assets  of  all  the  banks  liable  for  the 
notes  issued  by  any  one  of  them.  This,  under  the  strict  super- 
vision of  modern  financial  methods  which  the  banks,  in  their 
own  interest,  would  require  of  the  government,  would  make  a 
perfectly  safe  currency.  No  government  currency  is  perfectly 
safe,  for  the  reason  that,  when  taxation  has  reached  a  certain 
limit,  the  people  will  not  tax  themselves  further,  no  matter 
what  liappens.  There  is  no  financier  in  the  world  wlio  would 
not  prefer  a  currency  secured  by  all  the  assets  of  all  the  banks, 
which  he  can  levy  upon  and  sell,  to  the  pledged  faith  of  any 


148  THE    FARMER    AS    A    BUSINESS    MAN. 

government  whose  assets  he  can  not  touch  except  with  the 
consent  of  the  owner.  Of  course,  as  we  stand  now,  the  credit 
of  the  United  States  Government  is  unimpeachable,  but,  at  the 
close  of  a  long  war  with  united  Europe,  it  might  not  be  so. 
Such  a  war,  although  very  unlikely,  is  not  an  impossibility- 
and  its  cost  would  be  fearful.  It  is  such  contingencies  that 
financiers  consider. 

2.  The  bank  currency  is  the  more  stable. 

This,  also,  is  true,  under  the  present  National  Bank  Act,  and 
would  be  equally  true  under  any  act  which  would  attract  the 
assets  of  all  the  banks  as  security.  The  amount  of  issues  would 
be  regulated  by  law,  at  a  sufficiently  high  limit,  and  could  not 
be  exceeded,  while  the  obligation  to  redeem  on  demand  would 
prevent  any  excessive  issues  in  any  event.  If  too  much  were 
issued,  the  coin  would  be  demanded,  and  the  notes  retired 
On  the  other  hand,  there  is  no  instance  in  history  of  a  nation 
issuing  paper  money  without  being  led  into  excessive  issues. 
In  the  times  of  distress  which  come  to  all  nations,  and  which 
we  must  expect,  as  we  have  already  experienced  them,  nothing 
will  prevent  a  Legislature  from  issuing  paper  money  rather 
than  incur  the  unpopularity  of  taxation.  Our  Congress  has 
done  this,  and  another  Congress,  under  similar  stress,  would 
do  the  same  thing,  were  the  way  once  opened.  Then  fol- 
low rapid  fluctuations,  involving  loss  to  all,  but  most  of  all 
to  the  poor,  and,  in  the  end,  of  necessity,  contraction,  whose 
effects  the  present  generation  has  so  bitterly  felt. 

3.  The  bank  currency  is  the  more  "elastic" — that  is,  it  will 
be  issued  promptly  and  freely,  without  legislation,  within  its 
limit,  when  demanded  in  sudden  emergencies,  or  regularly  at 
the  busiest  seasons  of  the  year,  and,  when  the  use  for  the  excess 
ceases,  the  notes  will  be  presented  in  due  course  of  business, 
and  be  retired  until  again  needed.  The  government,  however, 
has  no  machinery  for  doing  this,  for  the  reason  that  it  does  not 
lend  money.*     It  can  disburse  to  the  people  only  in  payment 


*  A  certain  number  of  our  fellow-citizens  ask  that  government  should  lend 
money  "directly  to  the  people."  It  is  assumed  that  the  nation  can  borrow 
money  at  from  two  to  two  and  a  half  per  cent,  and  should  do  so  and  lend  to  its 
citizens,  upon  proper  security,  at  a  rate  sufBcicntly  higher  than  it  pays  to  cover 


THE  FARMER  AND  THE  BANKER.  149 

for  what  it  buys  from  them,  and  can  receive  from  them  only 
what  they  pay  in  taxes.  The  inflow  and  outgo  of  currency 
would  be  regulated  solely  by  the  taxation  and  disbursements 
of  the  government,  which  might  or»might  not  coincide  with 
the  necessities  of  business,  and,  in  any  event,  although  large, 
are  a  mere  trifle  in  comparison  with  the  business  of  the 
country.  Except  as  government  paid  out  for  salaries  or 
supplies,  no  increase  of  currency  would  be  possible,  no  matter 
how  badly  needed. 

All  this  is  not  only  true,  but  is  not  disputed,  and  needs  no 
further  explanation. 

It  is  claimed  by  those  favoring  a  bank  currency,  as  opposed 
to  government  issues,  that  these  considerations  enormously 
outweigh  the  mere  saving  of  interest  upon  those  issues. 


The  gravest  problem  of  the  day  is  the  control  of  the  money 
power.  Money  is  a  useful  servant,  but  a  terrible  master.  The 
proper  object  of  social  effort  in  this  respect  is  not  destruction 
but  control.  It  would  be  a  waste  to  destroy  power,  if  it  were 
possible,  which  it  is  not.  We  can  change  its  form,  and  direct 
its  work,  and  that  is  all.  In  some  form  the  accumulations  of 
thrift  and  foresight  will  influence  mankind.  The  highest 
efficiency  of  all  power  results  from  concentration,  and  the 
tendency  of  cai)ital  is  therefore  to  concentrate.  Thereby  it 
does  more  work.  It  is  desirable  that  the  benefits  of  this  work 
shall  be  equitably— not  necessarily  equally— distributed  among 
the  greatest  possible  number,  while  it  is  the  object  of  those 
who  use  capital  to  retain  all  its  benefits  for  themselves.  li 
the  owners  of  accumulated  capital  could  exact  fifty  per  cent 

cost  of  administration.  The  objections  to  this  are,  that  the  United  States  prob- 
ably could  not  borrow  the  large  sums  required  to  be  used  for  that  purpose,  at 
any  such  low  rate,  as  those  who  have  money  to  lend  would  have  no  confidence 
in  the  ability  of  the  government  to  engage  in  any  such  business  without  very 
large  losses  from  bad  debts,  which  the  people  would  be  unwilling  to  make  good 
by  taxation.  The  majority,  however,  who  wish  the  government  to  "issue 
money  direct  to  the  people,"  ask  that  paper  money  be  manufactured  in  quan- 
tities as  called  for,  based  upon  "  the  faith  of  the  people,"  and  loaned  to  those 
needing  it.  This  subject  will  be  found  fully  covered  in  another  chapter.  See 
book  sixth,  treating  of  "  Questions  of  the  Day." 


150  THE    FARMER    AS   A    BUSINESS    MAN. 

annually  for  its  use,  they  would  do  so.  But  they  can  not. 
Four  or  five  per  cent,  regular]}^  collected,  is  all  that  can  be 
expected,  and  is  considered  satisfactory.  Much  of  it,  and 
perhaps  most  of  it,  earns  •very  much  less.  A  great  deal  is  lost 
to  its  owners  by  bad  debts.  The  total  loss  of  the  money  loaned 
by  capitalists  to  the  confederacy  during  the  Rebellion  is  an 
instance  familiar  to  all  in  this  country.  Take  it  all  in  all,  it 
does  not  seem  to  me  that  capital  when  loaned  earns  for  its  owners 
rewards  which  farmers  would  deem  exorbitant,  and  therefore 
it  does  not  seem  to  me  that  efforts  to  control  the  use  of  money 
should  be  mainly  directed  towards  banks,  which,  in  the  popular 
mind,  are  the  re})resentatives  of  capital. 

Farmers  are  themselves  large  borrowers,  and  are  more  clam- 
orous for  "cheap  money"  than  any  other  class  of  our  citizens. 
All  attacks  upon  mone}^  whether  by  overtaxation,*  interference 
with  collections,  or  any  other  method,  tend  to  drive  loanable 
capital  from  the  states  where  those  practices  prevail,  and  cor- 
respondingly raise  the  rates  of  interest.  I  am  not  able  to  see 
any  business  sense  upon  the  part  of  farmers,  in  making  scarce 
and  dear  that  which  so  many  of  them  desire  to  obtain. 

The  fact  is  that  all  the  great  enterprises  of  the  world  are 
conducted  with  borrowed  money,  and  it  is  towards  the  borrow- 
ers rather  than  the  owners  of  capital  that  efforts  for  control 
should  be  mainly  directed.  Money  is  borrowed  at  low  rates, 
expecting  that  the  enterprises  in  which  it  is  invested  will  pay 
high  rates.  The  relations  of  the  farmer  to  some  of  these 
enterprises  are  considered  elsewhere. 

So  far  as  farmers  can  influence  legislation  affecting  banks, 
the  measures  whicli,  in  my  judgment,  they  will  be  wise  to  pro- 
mote, are  sufficiently  indicated  in  the  foregoing  pages.  They 
should  be  directed  to  insuring  the  safety  of  money  intrusted 
to  tlieir  custody,  and  if  tliey  issue  notes,  to  assuring  their 
redemption  on  demand.  Under  the  laws  of  all  states  note 
issues  are  a  first  lien  upon  the  assets  of  banks  issuing  them. 
After  they  are  paid,  the  depositors  come  in  for  what  is  left. 


*  All  money  is  almost  necessarily  overtaxed,  because  it  can  hardly  be 
assessed  otherwise  than  at  its  full  face  value,  while  in  many  states  all  other 
property  is  assessed  at  but  a  small  portion  of  its  real  value. 


TIIK    FAKMKR    AND    TIIK    BANKER.  151 

Under  our  national  banking  laws  tins,  of  course,  is  not  mate- 
rial, as  the  bonds  deposited  are  ample  security  for  the  notes, 
but  the  principle  is  the  same. 

All  states  provide  for  state  supervision  of  banks.  Officers 
are  appointed  to  examine  the  books  and  securities  from 
time  to  time,  and  if,  in  their  judgment,  the  funds  are  being 
unwisely  invested,  to  take  measures  to  compel  reform  or 
closing.  It  is  a  physical  impossibility  for  these  officers  to 
personally  examine  all  securities  and  count  the  money  in  the 
vaults.  In  the  main  they  must  rely  on  the  books.  Official 
examinations  are  not  therefore  very  effective  as  against  actual 
crime,  but  should  prevent  unbusinesslike  methods,  which  are 
often  the  first  steps  to  crime.  Much  depends  upon  the  capacity, 
vigilance,  and  honesty  of  official  bank  examiners.  Farmers 
should  understand  this,  and  should  aid  legislation  for  the 
effective  inspection  of  banks,  and  insist  upon  the  appointment 
of  men  of  higli  character  to  such  positions. 

They  should  promote  legislation  positively  forbidding  the 
loan  of  the  bank's  funds  to  any  officer  or  employee  of  the 
same  bank.  This  would  work  inconvenience  and  hardship 
in  many  cases,  for  heavy  depositors  are  the  most  profitable 
customers  as  borrowers,  and,  indeed,  must  borrow,  when  they 
need  to,  or  they  will  deposit  where  they  can,  and  it  often  hap- 
pens that  tliese  same  men  are  large  stockholders  in  banks  and 
the  most  desirable  for  directors  and  officers.  And  yet  it  is  to 
loans  obtained  by  inside  influence,  which  would  not  have  been 
made  except  for  sucli  influence,  that  most  trouble  comes  to 
banks.  If  permitted  at  all,  I  do  not  see  how  sucli  loans  can 
be  controlled  or  restricted,  and  can  therefore  see  no  safe  way 
except  to  positively  prohibit  them  and  endure  the  incon- 
venience. 


CHAPTER    IT. 

THE    FARMER    AXD    THE    COMMISSION    MERCHANT. 

NEARLY  all  perishable  products,  a  majority  of  the  semi- 
perishable,  and  probably  a  majority  of  staple  goods,  are 
sold  by  the  farmer,  through  commission  merchants  or 
brokers.  A  "broker"  is  a  commission  salesman  who  canvasses 
for  orders,  but  maintains  no  store  or  shop.  The  conrmission 
trade  of  the  United  States,  in  all  lines  witlj  which  I  am 
familiar,  is  in  a  thoroughly  unsatisfactory  condition.  It  is 
probably  so  in  all  lines.  While  any  experienced  business  man 
could  suggest  effectual  methods  for  correcting  the  abuses — real 
and  imaginary — attaching  to  this  business,  the  cooperation  of 
too  many  would  be  required  for  carrying  them  out  to  admit 
of  any  hope  of  success.  What  can  be  done  is  to  indicate  tJie 
nature  of  the  troubles,  with  their  ultimate  causes,  and  leave 
the  matter  to  be  dealt  with  in  the  light  of  the  sturdy  common 
sense  of  the  farmer. 

A  commission  merchant  or  broker  is  one  who  sells  goods 
for  account  of  another,  receiving  and  accounting  for  the  pro- 
ceeds. He  is  what  the  law  terms  the  "ageiit"  of  his  consignor, 
and  the  law  holds  him  strictly  to  the  powers  and  duties  of  an 
agent  as  defined  in  the  statutes  of  different  states  and  countrie.-. 
In  practice,  the  letter  if  not  the  spirit  of  these  obligations  is 
openly  violated  every  day  by  most  or  at  least  many  commis- 
sion men.  For  an  agent  to  apply  the  proceeds  of  a  commission 
sale  to  his  own  purposes  is,  in  most  states  and  countries,  if  not 
in  all,  a  crime.  Nearly  all  commission  merchants  deposit  the 
proceeds  of  tlieir  sales  to  their  own  account,  intermingled  with 
their  private  funds,  and  where  it  would  be  attacliable  for  their 
private  debts.  This  is  doubtless  a  matter  of  convenience,  and 
it  is  very  rarely  tiiat  losses  accrue  to  the  farmer  from  this 
cause,  but  it  is  not  a  correct  transaction. 

The  duty  of  the  commission  merchant  is  to  faithfully  j^irose- 
(  152  ) 


THE    FARMER    AND    THE    COMMISSION  MERCHANT.  153 

cute  the  l)usiness  of  his  consignor  to  the  best  of  his  ability  and 
judgment,  disposing  of  the  property  to  the  best  advantage, 
and  making  immediate  remittances  of  the  net  proceeds.  It 
will  be  ordinarily  understood  that  he  will  at  the  same  time  be 
acting  for  many  principals,  who,  as  between  themselves,  will 
be  competitors  of  each  other,  and  all  that  can  be  expected  is 
that  he  will  act  impartially  as  between  them.  At  tlie  same 
time  it  is  true  that  often,  in  a  glutted  *narket,  the  common 
agent  will  have  to  decide,  as  between  two  or  more  of  his  con- 
signors, whose  produce  shall  be  sold,  and  whose  shall  be  left 
unsold,  perhaps  to  deteriorate.  The  consignors  never  hear  of 
these  occasions,  which,  indeed,  can  not  be  avoided.  They 
have  no  recourse  but  to  rely  upon  the  fairness  of  their  agent, 
in  striking  a  fair  average  one  day  with  another.  It  would  be 
too  much  to  expect,  however,  that  agents,  in  making  these 
decisions,  should  not  be  more  or  less  influenced  by  their  opin- 
ion of  their  own  interests  in  securing  or  retaining  trade.  I 
have  never  heard  farmers  complain  of  unfairness  upon  the 
part  of  commission  merchants  in  this  respect.  Many  of  them 
have  probably  never  thought  of  it. 

But  while  commission  merchants  may,  in  the  main,  be  safely 
trusted  to  deal  fairly  as  between  different  consignors,  it  woidd 
be  contrary  to  all  human  experience  to  expect  them  to  deal 
fairly  as  between  themselves  and  others.  If  a  commission 
merchant  has  my  goods  for  sale,  and  some  of  the  same  kind 
of  his  own,  and  the  market  is  bad,  he  will  sell  his  goods  first, 
and  then  do  the  best  he  can  with  mine.  It  often  happens, 
indeed,  that  he  must,  for  he  may  have  bought  his  goods  with 
tlie  proceeds  of  some  sale  for  a  consignor  who  may  call  for  his 
money.     In  some  linos  of  trade  there  is  a  great  deal  of  this. 

It  was  once  a  fundamental  principle  of  the  commission 
trade  that  the  merchant  should  not,  under  any  circumstances, 
buy  and  sell  for  his  own  account.  I  am  not  acquainted  with 
the  practices  of  the  commission  trade  in  foreign  countries, 
but  am  of  the  opinion  that  in  some  of  them,  at  least,  there  is  a 
survival  of  this  good  old-fashioned  principle.  In  America  it 
is  dead.  Commission  merchants  may  and  do  speculate  freely 
in  the   products  for   whose   sale  they  are  agents,  and  often. 


154  THE    FARMER    AS    A    BUSINESS    MAN, 

unquestionably,  with  the  money  of  their  consignors.  In  some 
lines  of  trade  there  is  much  petty  fraud.  As  the  capital 
required  is  small,  the  business  is  greatly  overdone  in  all  cities, 
and  among  those  who  enter  the  trade  there  is  certain  to  be 
an  undue  proportion  of  dishonest  men.  This  is  inevitable 
because  dishonest  men  will  seek  to  enter  those  lines  of  trade 
which  afford  the  best  opportunities  for  dishonesty.  For  this 
the  commission  trade  has  no  equal.  The  consignors  are  not 
business  men.  Many  of  them  live  far  away.  They  have  no 
means  of  knowing  what  is  done  with  their  produce,  and  no 
ability  to  prosecute  if  wrong  is  discovered.  The  field  could 
not  well  be  more  inviting  to  dishonesty,  and  there  is  dishon- 
esty. At  the  same  time  there  are  as  honorable  men  in  this 
trade  as  there  are  in  any  business. 

I  think  the  fundamental  trouble  with  the  commission 
trade  is  that  public  opinion  permits  the  commission  agent  to 
buy  and  sell,  if  not  to  speculate,  in  the  products  for  which 
he  is  agent.  It  affords  the  temptation  to  dishonesty,  and 
the  means  of  covering  it  up.  When  my  commission  agent 
returns  me  an  account  of  sales,  he  does  not  usually  say  who 
has  bought  the  goods.  He  may  have  sold  them  to  himself,  to 
be  immediately  resold  at  a  higher  price.  It  is  done  every 
day  in  all  markets.  It  is  not  considered  fraudulent,  at  least 
by  the  trade.  The  only  remedy  is  a  return  to  primitive  cus- 
toms. This  can  only  be  secured  by  the  organized  action 
either  by  farmers  or  commission  men  themselves.  It  is  not 
likely  to  be  done  by  the  latter  until  organized  farmers  compel 
it.  The  first  step  towards  this  is  the  adoption  of  "  resolutions  " 
against  the  practice  by  the  grange  and  similar  influential 
organizations  of  farmers.  This  educates  public  opinion,  and 
l)repares  the  way  for  other  ste})S.  Even  this  stage,  however, 
has  not  been  reached.  On  the  contrary,  farmers  are  always 
extremely  eager  to  sell  outright  to  their  commission  agents, 
not  uniierstanding  that  these  men  almost  never  buy  except 
upon  almost  a  certainty  of  a  rising  market,  and  not  reflecting 
that  a  commission  merchant  who  has  this  habit  is  a  very 
unsafe  person  to  consign  to,  as  the  farmer  may  be  doing  in  a 
few   days.      I  will   not   willingly  put   my  produce   into  any 


TITE    FARMER    AND    THE    COMMISSION    AFEKCHANT. 


155 


man's  hand  to  be  sold  by  him  in  competition  with  his  own. 
If  I  deposit  money  in  a  bank,  or  if  I  insure  my  property, 
paying  a  premium  therefor,  I,  at  least  in  all  civilized  states, 
have  the  protection  of  a  rigid  system  of  law  governing  the 
conduct  of  the  business,  supplemented  by  inspection  by  state 
agents.  The  commission  business  is  as  much  a  trust  business 
as  banking  or  insurance,  and  the  small  producers  who  are 
compelled  to  intrust  their  produce  to  the  fidelity  of  conimis 
sion  merchants,  are  even  more  in  need  of  the  protection 
of  the  state  than  the  depositors  in  banks.  The  commission 
business  should  be  recognized  as  a  trust  business  requiring 
state  regulation.  The  obvious  method  of  dealing  with  it  is  to 
impose  state  licenses  sufficient  to  provide  the  revenue  to  pay 
for  inspection.  The  license  fee  for  commission  merchants 
desiring  to  buy  and  sell  upon  their  own  account  should  be 
placed  very  higJi,  perhaps  at  a  prohibitory  rate.  They  would 
thus,  at  any  rate,  be  known,  and  consignors  could  avoid  them 
if  they  so  desired.  There  probably  would  be  none  of  that 
class  registered.  The  enactment  of  such  a  law  would  prob- 
ably reduce  the  number  of  commission  mercliants  by  fifty 
per  cent,  as  those  most  familiar  with  the  business  estimate 
that  not  more  than  half  the  present  number  could  live,  if  the 
business  were  reduced  to  a  legitimate  basis. 

The  majority  of  commission  merchants  and  brokers  make 
only  a  living,  and  sometimes  a  poor  living.  Cum[)etition  is 
fiercer  than  in  almost  any  other  line  of  business.  The  notion 
of  some  farmers  that  commission  merchants  habitually  "com- 
bine" against  them  is  an  error.  They  are  harder  to  unite 
than  the  farmers.  Combinations  in  a  small  way  are  often 
attemi)tecl,  but  they  are  seldom  directly  against  the  interests  of 
tlie  farmer,  and  for  the  most  part  are  directed  towards  pro- 
tection from  bad  debtors.  An  open  and  responsible  organizn- 
tion  of  commission  merchants  is  a  very  desirable  thing  both 
for  themselves  and  the  farmers.  At  this  writing  tlicre  is  a 
national  society  of  commission  merchants  in  this  country, 
which,  it  is  to  be  hoped,  will  grow  and  become  strong. 

With  all  its  faults  the  commission  business  is  here  to  stay. 
The   alternative — cooperative   marketing — will  be  dealt  with 


156  THE    FARMER    AS    A    BUSINESS    MAN. 

elsewhere  in  this  volume.  A  cooperative  marketing  society 
simply  does  the  work  of  a  commission  house,  sometimes  at  a 
saving,  as  compared  with  the  employment  of  commission 
merchants,  and  sometimes  at  a  loss.  The  ordinary  rates  of 
commission  charged  in  the  different  branches  of  the  com- 
mission trade  are  fixed  by  competition  and  are  not  too  high. 
Large  gains  by  commission  merchants  can  onl}^  be  legiti- 
mately made  by  very  able  men,  competent  to  organize  and 
sustain  a  large  business.  The  principal  gains  in  the  business 
are  often  made  not  so  much  from  commissions  as  from  side 
interests  connected  with  the  handling  of  the  crops,  of  which 
the  farmer  never  hoars.  They  may  come  from  speculative  or 
other  buying  and  selling,  from  rebates  on  freight,  from  trans- 
portation companies,  or  draymen,  or  in  other  ways,  depending 
upon  the  branch  of  trade.  Tliese  methods  are  less  open  to 
cooperative  companies,  whose  main  reason  for  existence  lies 
rather  in  their  power  to  prevent  combinations  or  speculative 
movements  to  the  injury  of  the  farmer.  While  cooperative 
marketing  is  increasing,  and  likely  to  increase,  the  commis- 
sion trade  is  increasing  also  with  the  growth  of  the  country. 
It  should  be  recognized  and  regulated. 

As  it  stands,  the  relation  of  principal  and  agent,  which 
should  be  cordial  and  confidential,  is  too  often  one  of  mutual 
distrust  and  dislike.  The  farmer  says  tliat  the  commission 
merchant  cheats  in  his  returns,  and  the  merchant  says  that 
the  farmer  cheats  in  his  packing.  Both  are  often  correct. 
In  selecting  a  commission  merchant  a  farmer  should  be  at  the 
expense  of  visiting  his  man  in  his  place  of  business.  Nothing 
else  will  really  answer.  Seek  a  firm  whose  members  look 
honest,  and  appear  to  act  honestly.  Give  them  your  confi- 
dence, send  them  honestly-packed  produce,  and  stay  by  them. 
Upon  the  occasions  when  a  commission  merchant  has  to 
choose  between  the  interests  of  two  customers,  he  will,  if  he  is 
bright,  favor  the  regular  instead  of  tlie  occasional  shipper. 
Sometimes  they  do  not  do  this,  in  the  endeavor  to  attract  new 
trade,  while  trusting  to  habit  to  retain  the  old.  But  such  a 
course  is  unwise,  and  most  merchants  know  too  much  to 
attempt  it.     A.  man  shipping  to  two  commission   merchants 


THE    FARMER    AND    THE    COMMISSION    MERCHANT.  157 

has  his  own  brand  competing  with  itself  in  the  same  market. 
It  does  not  pay  either  firm  to  specially  advocate  the  brand, 
because  it  has  no  monopoly  of  it. 

A  feature  not  touched  upon  yet  is  that  of  advances. 
When  a  farmer  accepts  a  loan  from  one  wdio  should  be  his 
servant,  the  natural  conditions  are  reversed.  The  real  owner 
of  the  produce  is  the  commission  merchant  who  has  made 
the  advance,  if  it  is  a  large  one,  and  he  Avill  treat  it  as  his 
own,  so  far  as  he  chooses  to  do  so.  It  will  probably  be  loaded 
with  an  expense  which  will  bring  a  profit  to  the  commission 
merchant.  If  the  final  account  does  not  show  the  advance 
repaid,  the  crop  for  the  next  year  is  "  tied  up,"  as  all  contracts 
for  advances  run  in  that  way.  The  proper  place  for  a  farmer 
to  borrow  money  is  at  his  bank.  If  his  credit  is  insufficient 
to  effect  that,  he  is  farming  on  inadequate  capital.  In  this 
case  he  must  do  the  best  he  can,  which  is  probably  to  go  to 
the  commission  merchant.  If  compelled  to  borrow  of  your 
agent,  frankly  accept  the  situation,  inform  him  fully  of  your 
affairs,  pack  your  goods  in  the  very  best  manner,  seek  to  fulh 
understand  market  conditions,  and  be  satisfied  with  the  result, 
whatever  it  is.  Under  such  circumstances  the  commission 
merchant  w^ill  be  very  likely  to  do  his  best  for  you,  and  these 
unnatural  relations  may  continue  pleasant  for  years.  A  farmer 
wdio  is  upright,  frank,  and  prompt  will  be  almost  certainly  met 
in  the  same  spirit  by  the  commission  merchant  who  has  lent 
him  money. 


CHAPTER    III. 

THE   FARMER   AND   THE   RAILROADS. 

THE  measure  of  profit  to  be  derived  from  a  study  of  a 
few  problems  in  transportation  will  depend  largely 
upon  the  degree  in  which  the  reader  succeeds  in  for- 
getting all  that  he  has  read  upon  the  subject  in  the  partisan 
press,  and  in  banishing  from  his  mind  the  prejudices  arising 
from  heated  controversy.  This  will  be  quite  difficult  to 
readers  in  new  and  sparsely-settled  districts,  whose  products 
must  be  transported  over  long  lines  of  railroad  constructed  by 
speculative  methods.  Under  such  circumstances  the  owners 
of  the  roads  will  be  engaged  in  constant  struggles — usually 
unavailing — to  extort  from  an  inadequate  traffic  a  revenue  to 
pay  interest  upon  an  inflated  capitalization.  The  railroads 
thus  situated  will  represent  the  dominant  money  power  of  the 
state,  and  the  money  force  will  be  relentlessly  applied  to  pro- 
mote the  ends  of  the  management.  The  railroads  will  be 
constant  applicants  for  legislative  action  or  non-action,  and 
what  they  seek  will  be  sometimes  proper  and  sometimes 
improper.  In  either  case  they  will  be  in  a  very  difficult 
position.  To  all  Legislatures  the  people  will  send  a  certain 
number  of  members,  who  will  not,  if  they  can  help  it,  permit 
any  bill  desired  by  any  financial  interest  to  become  a  law 
unless  they  themselves  derive  from  it  some  personal  profit. 
For  this  condition  of  affairs  the  people  alone  are  to  blame. 
The  railroads  have  to  deal  with  it.  There  is  a  widespread 
opinion  that  railroads  desire  to  see  corrupt  men  in  Legislatures. 
This  is  not  true.  While  I  have  no  personal  acquaintance 
with  railroad  political  management,  yet  my  opportunities  for 
observation  of  other  financial  interests  have  been  such  as  to 
warrant  the  unequivocal  statement  that  all  men  who  are  in 
charge  of  great  enterprises  know  it  to  be  to  their  interest  that 
Legislatures  and  municipal  councils  should  be  incorruptible. 

(158) 


THE    FARMER    AND    THE    RAILROADS.  159 

Doubtless  if  tlie  people  are  to  elect  corrupt  men  the  corpora- 
tions prefer  those  whom  they  can  control  most  cheaply,  and 
will  endeavor  to  get  them.  In  the  newer  states  the  corpora- 
tions can  not  afford  to  openly  advocate  the  election  even  of  an 
honest  man,  for  a  certain  portion  of  the  public  press  is  quite 
as  corrupt  as  any  Legislature,  and,  unless  itself  conciliated, 
will  denounce  any  candidate  believed  to  be  favored  by  rail- 
road interests,  as  "wearing  tlie  railroad  collar."  In  matters  of 
legislation,  whether  what  ma}^  be  desired  by  the  railroads  be 
proper  or  improper,  to  favor  anything  which  is  desired  by 
''the  railroads"  is  in  some  states  quite  sufficient  to  assure 
denunciation  from  a  large  portion  of  the  press,  and  suspi- 
cion and  discredit  from  the  public.  In  the  older  and  richer 
states,  where  other  great  financial  interests  compete  with  each 
other  for  the  distrust  of  the  public,  the  railroad  issue  is  not  so 
overpowering. 

While  fully  recognizing  the  baleful  influence  which  cor. 
ruption,  engendered  in  railroad  offices,  has  had  upon  our 
legislation,  and  whatever  our  familiarity  with  the  disgraceful 
history  of  railroad  management  in  America,  no  good  whatever 
can  come  from  indiscriminate  attacks  upon  these  indispen- 
sable instruments  of  civilization.  What  society  has  to  do  is 
to  faithfully  and  impartially  study  facts  and  conditions,  with 
the  intent,  whenever  these  shall  be  mastered,  of  deciding  what 
is  right  and  compelling  obedience  to  it.  Thus  far,  in  the 
contest  with  railroads,  while  the  farmers  have  been  very 
active,  they  have  been  almost  entirely  uninformed,  and  conse- 
quently have  as  often  been  wrong  as  right  in  the  subjects  of 
detail  over  wdiich  contests  have  arisen. 

The  fact  is  that  in  nine  cases  out  of  ten  the  real  interests 
of  transportation  companies  are  identical  with  those  of  the 
communities  which  they  serve.  This  is  probably  true  even  as 
to  the  matter  of  freights  and  fares,  in  regard  to  which  contests 
are  continually  occurring.  It  unfortunately  happens,  how- 
ever, that  railroad  properties  are  not  always  managed  in  the 
interests  of  their  real  owners,  and  it  is  equally  true  that  the 
most  of  the  community  has  very  little  knowledge  either  of  its 
own  interests  or  those  of  transportation  companies,  and  espe- 


160  THE    FARMER    AS   A    BUSINESS    MAN. 

daily  of  the  enormous  difficulties  attending  the  reconciliation 
of  the  innumerable  conflicts  of  interests  between  localities, 
each  entitled  to  equal  consideration,  with  which  railroad 
managers  are  compelled  to  deal.  Railroad  questions  are  more 
often  contests  between  the  people  of  one  locality  and  those  of 
another,  than  between  railroad  owners  and  the  people  at  large. 
The  deciduous  fruit-growers  of  California,  finding  it  difficult 
to  meet,  in  distant  markets,  the  competition  of  those  living 
nearer,  demand  from  the  company  which  receives  their 
products,  and  which  they  think  of  as  omnipotent  in  the 
matter,  rates  low  enough  to  hold  the  market,  whatever  they 
may  be,  basing  their  demands  on  the  contention  that  even 
although  the  traffic  may  yield  no  profit,  the  local  traffic  which 
will  arise  in  a  prosperous  community  will  fully  make  good 
the  failure.  Suppose  this  to  be  recognized  by  the  California 
company,  it  is  powerless  to  make  a  rate  which  is  not  satis- 
factory to  its  connecting  lines,  who  may  be,  and  in  fact  are, 
interested  in  building  up  prosperous  communities  upon  their 
own  lines.  The  fruit-growers  of  Colorado,  for  example,  are 
interested  in  having  high  rates  on  the  California  product,  and 
the  contest,  up  to  a  certain  point,  is  between  the  fruit-growers 
of  California  and  those  of  other  states.  This  entire  volume 
might  easily  be  filled  with  compact  statements  of  similar 
cases.  They  are  constantly  arising  before  the  Inter-state 
Commerce  Commission.  The  "railroad  problem"  in  such  a 
country  as  the  United  States  is  too  complicated  for  even  the 
strongest  intellects  to  deal  with  in  such  a  way  as  to  do  exact 
justice  to  all  interests  involved.  To  deal  with  it  in  a  spirit  of 
passion  and  vindictiveness,  and  without  the  light  of  all  infor- 
mation which  can  be  obtained  and  digested,  is  not  only 
absurd  but  ruinous.  We  may  recognize,  with  sorrow,  that  the 
history  of  our  railroad  development  has  been  largely  one  of 
plunder,  both  of  investors  and  of  the  public,  and  with  satis- 
faction that  the  very  magnitude  of  the  business  is  at  last 
compelling  honesty  and  wise  statesmanship  to  assert  them- 
selves, but  neither  of  these  considerations  should  be  allowed  to 
occupy  our  minds.  The  question  is  along  what  lines  of  public 
regulation  can  these  enormous  properties  be  best  made  to  serve 


THE  FARMER  AND  THE  RAILROAOS.  l(ji 

the  necessities  of  the  public,  while  protecting  honest  investors 
from  spoliation,  and  assuring  them  a  just  revenue  from  their 
investment.  It  will  be  possible,  here,  to  consider  but  a  very 
few  even  of  the  most  important  questions  which  must  arise. 
As  a  preliminary  to  our  study  it  is  necessary  to  make  a  few 
statements  of  fact. 

The  nominal  capital  of  a  railroad  company  is  represented 
by  its  outstanding  stock  and  bonds.  The  bonds  represent 
money  Avhich  has  been  invested  in  the  road,  and  in  theory  is 
a  debt  for  whose  payment  the  stockholders  are  responsible. 
In  fact,  it  is  a  debt  never  intended  to  be  paid,  but  forever  to 
remain  invested  and  earning  interest.  The  stockholders  con- 
trol the  property,  so  long  as  interest  upon  the  bonds  is  met. 
The  bondholders  get  their  interest  in  full  before  stockholders 
receive  anything.  If  default  is  made  in  interest  upon  bonds, 
the  mortgage  securing  them  is  foreclosed,  and  the  stockholders 
lose  whatever  investment  they  have  made.  While  the  above 
is  true,  in  theory,  in  many  cases,  of  late  years,  bondholders,  by 
means  of  agreements  which  are  made  effective,  are  assured  a 
certain  representation  in  the  directory  of  tlie  road. 

In  1896  the  nominal  capitalization  of  the  railroads  of  the 
United  States  was  $9,744,399,332,  of  which  $5,226,527,209  was 
stock,  and  $4,517,872,063  was  bonds.  Upon  stock  to  the 
amount  of  $3,667,503,194,  or  70.17  per  cent  of  the  rated  stock 
outstanding,  no  dividends  whatever  were  paid,  and,  for  the 
most  part,  probably,  ought  not  to  have  been  paid,  as  not  repre- 
senting actual  investment,  although  to  some  extent  actual 
investment  is  represented,  even  in  this  class  of  stock.  On  the 
remaining  29.83  per  cent  of  the  stock,  dividends  to  the  amount 
of  $87,603,361  were  paid,  or  5.62  per  cent  on  the  par  value  of 
the  dividend-paying  stocks,  the  actual  rates  paid  varying  from 
one  to  ten  per  cent.  The  dividend-paying  stocks  are  mainly 
in  the  old  and  thickly-settled  parts  of  the  country,  and  to  a 
large  extent,  but  not  wholly,  represent  actual  investment. 
Tlie  capital  of  a  few  railways  in  New  England  is  entirely 
represented  by  stock,  upon  which  large  dividends  are  paid. 
The  capital  stock  of  some  prosperous  railroads  has  been 
"watered"  by  "stock  dividends,"  until  a  small  dividend  on 
11 


162  THE   PARMER   AS   A   BUSINESS   MAN. 

the  outstanding  stock  represents  a  very  large  dividend  upon 
actual  investment.  Upon  the  outstanding  bonds,  interest  to 
the  amount  of  $249,624,177  was  paid.  There  were,  however, 
bonds  to  the  amount  of  $515,029,668,  upon  which  no  interest 
whatever  was  paid;  upon  7.83  per  cent  of  the  total  out- 
standing bonds,  three  per  cent  was  paid,  which  in  all  cases 
doubtless  indicates  partial  default.  The  bonds  of  a  railroad 
are  supposed  to  represent  actual  investment,  but  do  not  always 
do  so.  In  some  cases  they  represent,  practically,  "  bonuses," 
given  to  certain  security  liolders  in  the  process  of  reorganiza- 
tion, and  in  other  cases  exorbitant  profits  to  constructors,  often 
obtained  by  collusion  with  officials  supposed  to  guard  the 
interests  of  stockljolders. 

The  above  figures  show  that  the  question  of"  watered  stock," 
which  so  largely  occupies  the  attention  of  farmers,  is  not  a  very 
important  one,  the  fact  being  that  watered  stock,  except  in  the 
case  of  old  railroads  in  rich  communities,  seldom  pays  any 
dividends.  It  is  valuable,  first,  as  a  means  of  controlling  the 
properties  by  those  who  expect  to  make  profit  by  their  control, 
and,  secondly,  upon  the  chance  that  it  may  sometime  be  made 
to  pay  dividends. 

The  people,  in  1896,  paid  for  transportation  of  persons  and 
freight  the  sum  of  $1,150,169,376,  or  about  three  and  one-half 
times  as  much  as  they  paid  for  the  support  of  the  general 
government,  and  over  $100,000,000  more  tiian  the  combined 
federal,  state,  and  local  taxation  in  1890.  This  great  revenue 
is  best  considered,  when  considering  the  subject  from  the 
standpoint  of  the  public,  as  a  tax,  levied  by  an  assessment 
upon  the  immediate  beneficiaries,  and  by  them  passed  on,  so 
far  as  possible,  to  the  public  at  large,  as  other  indirect  taxes  are 
passed  on.  This  makes  clear  the  interest  of  the  general  public, 
even  although  that  term  may  include  persons  who  never  saw 
a  railroad. 

In  their  early  history  railroads  were  regarded  as  private 
property,  to  bo. administered  according  to  the  will  of  their 
owners,  subject  only  to  the  provision  of  the  common  law  that 
as  common  carriers  tlieir  cliarges  for  service  must  be  "reason- 
able."    It   is  obvious,  however,  tliat  a  road  bed,  constructed 


THE    FARMER    AXD    THE    RAILROADS.  1G3 

and  paid  for  by  a  private  company,  upon  which  no  transporta- 
tion is  permitted  except  in  conveyances  owned  and  operated 
by  the  company,  bears  very  little  resemblance  to  a  public 
thoroughfare,  built  and  controlled  by  the  public,  and  upon 
which  any  one  is  free  to  travel.  The  old  precedents — even 
those  relating  to  toll  roads— were  practically  valueless.  A 
new  system  of  law  was  built  up,  and  in  the  absence  of  legisla- 
tive action  was  built  up  by  the  railroads  themselves.  As  any 
private  interest  which  has  power  will  abuse  it,  tliis  power  was 
abused,  and  then  came  a  conflict,  which  was  finally  settled  by 
the  Supreme  Court  of  the  United  States,  by  the  decision  that 
tlie  public  had  the  right  to  regulate  the  administration  of  rail- 
road affairs,  including  the  power  to  regulate  fares  and  freights, 
subject  only  to  the  limitation  imposed  by  the  common  law 
upon  the  railroads  themselves,  that  the  tariffs  so  fixed  must 
be  "reasonable" — a  court  of  proper  jurisdiction  being,  in  the 
last  resort,  the  judge  of  what  is  "reasonable."  Practically^  the 
term  "reasonable"  has  come  to  mean  such  rates  as,  in  the 
aggregate,  should  provide  a  revenue  sufficient  to  yield  a 
proper  rate  of  interest  eitlier  upon  actual  investment,  the  cost 
of  reproduction,  or  the  present  value  as  affected  by  existing 
conditions,  including  competition,  or  by  such  a  combination 
of  all  three  methods  of  computation  as  may  seem  just  to  all 
parties  in  any  particular  case. 

This  brings  us  to  the  consideration  of  a  vexed  question 
which  is  fundamental.  Upon  what  sum  shall  a  railroad  be 
permitted  to  earn  dividends?  In  popular  discussion  the  advo- 
cate of  the  railroads  points  to  the  enormous  aggregate  of  out- 
standing stock  and  bonds,  and  asks  to  be  allowed  to  earn 
interest  upon  that.  At  this,  however,  the  public  laughs,  as 
well  it  may,  and  indeed  that  contention  is  now  seldom  made, 
even  in  popular  discussion.  It  is  never  attempted  before  any 
competent  tribunal.  The  aggregate  of  paper  indebtedness  is 
recognized  as  of  no  value,  e.Kcept  to  maintain  the  balance, 
which  the  exigencies  of  bookkeeping  requires. 

Some  say  that  interest  should  be  earned  on  actual  invest- 
ment. But  there  have  been  so  many  "  reorganizations"  and 
"consolidations,"  and   such  a  disappearance  of  old  books  of 


164  THE    FARMER    AS    A    BUSINESS    MAN. 

original  or  construction  companies,  that  only  in  a  few  cases 
could  actual  original  investment  ever  be  discovered,  even  by 
the  most  laborious  investigation,  and,  if  it  were  possible,  the 
time,  labor,  and  expense  of  it  would  be  beyond  all  reason. 
Besides,  the  public  can  not  afford  to  accept  the  principle. 
Individuals  make  losing  investments,  and  must  suffer  the 
consequences.  Shall  raih'oad  investments  be  held  so  sacred 
that  the  public  must  be  taxed  forever  to  pay  interest  upon  the 
cost  of  a  railroad  improvidently  or  extravagantly  built?  The 
original  cost  is  not  seriously  considered  by  courts,  although, 
when  it  can  be  proven,  it  has  due  weight.  In  some  cases,  of 
course,  the  public  would  be  a  large  gainer  by  the  adoption  of 
this  principle,  as,  for  example,  doubtless,  in  the  case  of  the 
original  Hudson  River  Railroad  in  New  York. 

Another  class  wishes  income  to  be  allowed  upon  the  cost  of 
reproduction,  which  can  always  be  computed  very  closely.  The 
cost  of  railroad  building,  like  that  of  other  things,  is  much  less 
than  it  used  to  be,  and  tends  constantly  to  grow  less.  Every 
railroad  built  lessens  the  cost  of  constructing  a  competing  rail- 
road. Shall  we  make  a  new  estimate  of  cost  of  reproduction 
every  year,  or  every  five  years,  and  raise  or  lower  the  rates  at 
each  valuation;  or,  having  once  fixed  the  value  in  that  way, 
shall  we  continue  to  allow  income  upon  that  value  forever? 
And  if  the  latter,  in  what  way  does  that  differ,  in  principle, 
from  accepting  tiie  actual  original  cost,  when  it  can  be  known? 
The  railroad  owners  say  that  in  making  their  investment  they 
took  their  chance  of  profit.  If  business  does  not  follow  as 
they  expected,  they  must  lose;  on  the  other  hand,  if  the 
movement  of  population  favors  them,  they  expect  to  gain,  as 
others  who  take  similar  risks  gain  by  unearned  increment. 

Still  others  say  that  we  must  consider  not  only  cost  of 
reproduction,  but  other  conditions,  external  to  the  road,  as,  foi- 
example,  the  construction  of  a  parallel  line.  Such  lines  have 
been  built  in  this  country,  along  valuable  railroad  properties, 
notoriously  with  the  intent  to  make  a  profit  only  by  so  reduc- 
ing the  value  of  the  original  line  as  to  compel  its  owners  to 
buy  in  the  new  line.  Obviously,  so  long  as  the  comi)etition 
existed,  the  question  of  excessive  rates  would  not  be  raised, 


THE    FARMER    AND    THE    RAILROADS.  165 

but  upon  what  sums  shall  income  be  allowed,  either  to  the 
two  lines  before  the  inevitable  consolidation,  or  the  single 
company  afterward  ? 

My  intent  here  is  not  to  decide  all  these  hard  questions, 
for  if  I  could  do  so,  justly,  my  services  would  be  in  too  great 
demand  to  permit  me  to  write  this  book,  but  to  indicate  the 
difficulty  of  what  seem  to  some  simple  matters.  The  fact  is 
that  the  question  of  the  just  capitalization  of  railroad  proper- 
ties can  only  be  decided  as  individual  cases  arise,  by  competent 
tribunals  with  all  available  information  before  them  ;  and 
upon  human  judgment  and  integrity,  thus  acting  under  a  sense 
of  responsibility,  we  must  finally  rest  There  can  apparently 
be  no  general  rule  which  will  work  justice  in  all  cases. 

The  rate  of  income  to  be  allowed  is  seldom  the  occasion  of 
popular  discussion.  All  seem  agreed  that  capital  honestly 
invested  is  entitled  to  remuneration,  fixed  by  the  current 
rates  of  long-time  interest,  with  a  proper  allowance  for  risk, 
and  with  some  consideration  for  the  length  of  time  for  which 
the  property  has  been  unproductive,  as  in  the  case  of  develop- 
ment roads  built  into  new  country.  The  public  is  not  mean 
about  such  things,  but,  on  the  contrary,  is  generous. 

But  suppose  the  proper  capitalization  agreed  upon,  and  the 
income  to  be  produced  fixed,  in  what  way  shall  the  burden  of 
producing  it  be  adjusted?  And  this  leads  into  a  whole  nest 
of  knotty  questions. 

I  pick  up,  at  random,  an  old  report,  and  find  that  in  a 
certain  year  a  railroad  com[)any  transported  freight  to  an 
amount  equal  to  704,772,500  tons  one  mile,  and  that  the  total 
expense  chargeable  to  freight  traffic,  divided  by  the  number 
of  ton  miles,  gives  eighty-three  one-hundredths  of  a  cent  as 
the  average  cost  of  hauling  one  ton  one  mile.  Tlie  cost  of 
the  individual  services  rendered  of  course  varied  greatly,  for 
the  road  is  a  long  one,  and  hauling  is  much  cheaper  upon 
some  divisions  than  upon  others.  The  cost  of  transporting 
a  certain  commodity  a  certain  distance  by  rail  is  not  com- 
putable by  the  most  skilled  transportation  expert,  but  it  is 
affected  by  many  things,  as,  for  instance,  length  of  haul,  cost 
of  coal,   rate   of    w^ages,   gradients   and   curves,   presence   or 


166  THE    FARMER    AS    A    BUSINESS    MAN. 

absence  of  snow  and  floods,  equality,  or  lack  of  it,  of  traffic  in 
each  direction,  and  volume  of  business.  Assuming,  however, 
eighty-three  one-hundredths  of  a  cent  as  the  average  cost  per 
ton  j:ier  mile  upon  that  road,  there  may  be  some  who  would 
think  that  the  production  of  a  revenue  would  mean  simply  the 
addition  to  the  average  cost  of  whatever  is  necessary  to  pay 
the  desired  income  upon  the  capital,  and  making  that  rate 
apply  to  all  freight  carried. 

The  result  of  sucli  an  attempt,  however,  would  be  the 
immediate  disappearance  of  a  large  part  of  the  traffic,  which 
could  not  bear  the  average  rate.  Railroads  can  not  be  run 
upon  this  principle.  Any  attempt  to  apply  it  would  so  raise 
the  price  of  such  commodities  as  coal,  lumber,  cement,  pig- 
iron,  and  the  like,  where  transported  by  rail,  as  to  make  their 
delivery  impossible  to  many  communities  now  obtaining  them 
cheaply.  It  would  prevent  the  working  of  numberless  mines  of 
low-grade  gold,  lead,  copper,  and  silver  ore,  whose  output  is  now 
carried  to  smelters  at  any  rates  which  will  pay  any  profit  at 
all,  above  actual  cost  of  train  service.  No  railroad,  whether 
owned  by  a  private  corporation  or  the  state,  ever  was  or  ever 
can  be  run  upon  such  a  principle,  if  it  is  proposed  to 
adequately  serve  the  public,  while  producing  any  income  upon 
the  capitalization.  The  method  always  adopted  is  to  classify 
the  commodities,  and  charge  the  highest  rates  upon  those 
which  are  able  to  pay  the  most — that  is,  those  having  the 
highest  value  for  the  same  weight  or  space.  A  car-load  of  silk 
might  perhaps  easily  pay  from  San  Francisco  to  New  York  a 
rate  of  $5.00  per  one  hundred  pounds,  which  is  about  three  and 
one-third  cents  per  ton  per  mile,  while  California  fruit-growers, 
who  now  pay  $1.25  per  one  hundred  pounds,  or  about  eighty- 
five  one-hundredths  of  a  cent  per  ton  per  mile,  find  it  very 
difficult  to  deliver  their  product  at  such  rates  as  will  enable 
it  to  be  sold  at  a  profit.  It  is  not  intended  to  discuss  or  even 
explain  further  the  principles  of  rate  making,  but  simply  to 
show  that  freight  rates  must  be  fixed  according  to  "  what  the 
traffic  can  bear."  By  this  it  is  not  meant  that  railroads  should 
be  permitted  to  seize  all  the  profit  arising  from  the  movement 
of  commodities,  but  only  to  assess  the  necessary  revenue 
largely  upon  the  basis  of  that  profit. 


THE    FARMER    AND   THE    RAILROADS.  167 

It  is  in  the  application  of  this  necessary  principle,  however, 
that  some  of  the  worst  abuses  of  railroad  power  have  occurred, 
and  in  regard  to  whicli  most  of  tlie  contests  between  the  rail- 
roads and  the  people  arise.  The  expert  knowledge  required 
to  arrange  such  a  tariff  sheet  as  shall  be  just  to  all  concerned, 
and  yet  produce  the  necessary  revenue,  is  perhaps  even  more 
than  that  required  to  adjust  a  national  tariff  on  imports, 
because,  in  addition  to  an  intimate  knowledge  of  industries 
and  localities,  the  details  of  rail  traffic  must  be  known  with 
equal  accuracy.  Even  when  all  these  are  mastered,  there 
comes  the  factor  of  intense  competition  from  other  carriers, 
whose  conditions  are  constantly  changing.  So  that  the  rate- 
maker  of  a  railroad,  even  with  the  best  intentions  in  the 
world,  is  likely  to  be  driven  to  let  go  every  other  consideration 
except  the  procurement  of  all  tlie  revenue  possible  for  his 
road,  regardless  of  any  other  interest.  This,  however,  the 
public  can  not  permit. 

The  abuses  which  have  resulted  from  the  struggle  for 
revenue  are  of  three  classes: — 

Discriminations  between  individuals. 

Discriminations  between  localities. 

Discriminations  between  industries. 

Discriminations  between  individuals,  which  have  always 
been  in  favor  of  the  strong  and  against  the  weak,  are  abhor- 
rent to  the  natural  sense  of  justice  which  is  common  to  all  of 
us.  They  are,  and  always  have  been,  contrary  to  law,  but 
there  has  never  been  any  remedy.  The  lawyers  will,  of  course, 
say  that  any  one  who  can  prove  himself  to  have  been  dam- 
aged, could  get  a  judgment  against  tlie  offender,  but  as  indi- 
vidual discrimination  can  seldom  be  proven,  and  as  no  one 
could  afford  to  litigate  on  such  a  subject  with  a  railroad  com- 
pany,there  has  practically  been  no  remedy.  It  is  necessary  that 
the  public  assume  the  duty  of  assuring  equality  of  treatment  as 
between  individuals.  In  interstate  commerce  United  States  law 
makes  discrimination  between  individuals,  criminal  offenses, 
and  the  same  is  usually  true  by  state  law,  as  to  traffic  within  the 


168  THE    FARMER    AS    A    BUSINESS    MAN. 

state.*  The  difficulty  has  been  to  get  the  facts.  The  United 
States  Interstate  Commerce  Commission,  which  was  organized 
in  1887,  attacked  this  problem  with  great  vigor,  and  within  two 
years  was  able  to  report  that,  in  the  opinion  of  the  commission, 
this  abuse,  as  to  interstate  commerce,  had  ceased.  At  that  time 
the  commission  and  the  railroad  companies  supposed  that  the 
powers  given  to  the  commission  by  the  act  were  ample  to  dis- 
cover the  facts  and  enforce  its  authority.  This  being  the  case, 
the  practice  probably  did  stop.  Subsequently  successive  dis- 
cussions of  the  Supreme  Court  took  away  from  the  commis- 
sion most  of  its  power,  and  as  a  consequence  law-breakers  have 
ceased  to  fear  it.  All  railroad  companies  resolutely  den}'  that 
discrimination  between  individuals  now  exists,  but  nobody 
believes  them.  Some  high  railroad  officials  have  unquestion- 
ably committed  perjury  in  swearing  that  they  "did  not  remem- 
ber" as  to  matters  which  they  doubtless  did  remember  per- 
fectly. Such  perjury  can  not  be  prov.en,  and  therefore  can  not 
be  punished.  Indirect  methods  of  giving  individuals  prefer- 
ences have  been  devised.  A  rich  concern  may  own  its  private 
cars,  for  whose  use,  over  its  lines,  the  railroad  company  may 
pay  an  exorbitant  rental.  This  is  not  possible  to  the  poorer 
rival.  "Refrigerator  car"  companies  are  capable  of  being,  and 
are,  made  use  of  as  means  of  discrimination  between  large  and 
small  shippers.  Wliat  are  known  as  "terminal"  or  "switching" 
charges  are  remitted  or  rebated  to  large  sliippers.  Finally, 
actual  cash  rebates,  usually  in  the  form  of  "commissions,"  are 
doubtless  paid  to  large  sliippers  in  some  cases.  Tlie  actual 
rates  paid  by  individuals  are  tlie  same.  In  some  form,  liow- 
ever,  the  stronger  get  some  of  it  back,  and  the  richer  the 
concern  the  more  it  gets.  Of  these  statements  probably  not  a 
single  one  could  be  proven  in  any  court.  But  tliey  are  true. 
Discriminations  between  localities  can  not,  in  the  nature 
of  things,  be  secret.  They  are  always  earnestly  defended  by 
the  favored  localities,  and  bitterly  attacked  by  communities 
injured.     They  are  as  unjust  and  unlawful  as  discriminations 


*  I  assume  that  all  understand  that  Congress  has  exclusive  jurisdiction  of 
all  traflSc  passing  from  one  state  to  another,  and  that  states  have  exclusive  juris- 
diction of  traffic  wholly  within  their  own  boundaries. 


THE    FARMER    AND    THE    RAILROADS.  169 

between  individuals.  They  are,  perhaps,  not  now  made  to 
such  an  extent  as  formerly,  as  when  complaint  is  made  some 
excuse  must  be  given.  The  defense  almost  invariably  set  u]) 
is  "competition."  In  the  cases  which  came  before  it,  the 
Interstate  Commerce  Commission  laid  down  the  principle  tliat 
competition  by  water,  which  is  not  regulated  by  law,  is  a 
sufficient  excuse,  but  that  competition  by  rail,  which,  if  undue, 
could  be  controlled  by  law,  was  not  a  good  defense.  The 
Supreme  Court,  however,  held  that  it  was,  and  localities 
injured  by  the  preference  of  other  places  under  such  circum- 
stances, probably  have  no  redress  until  the  law  is  changed. 

"Competition"  is  the  defense  usually  made  by  railroads  for 
all  violation  of  the  law  that  no  greater  freight  rate  shall  be 
made  upon  the  same  commodity  for  a  shorter  than  a  longer 
distance  in  the  same  direction,*  the  shorter  distance  being 
included  in  the  longer — and  "conditions"  being  substantially 
similar.  In  interstate  commerce,  the  commission,  in  cases 
where  it  finds  conditions  not  similar,  may  give  permission  to 
make  a  larger  charge  for  the  shorter  haul. 

There  can  be  no  doubt  that  this  is  sometimes  to  the  interest 
of  the  general  public,  even  although  contrary  to  the  interest 
of  some  particular  locality.  It  is  necessary  that  each  road 
raise  a  certain  revenue  from  its  traffic.  Whatever  it  can 
obtain  from  any  one  source  decreases  by  so  much  the  neces- 
sary collections  from  all  other  sources.  Each  commodity 
handled  ought,  if  it  be  possible,  to  pay  its  just  share  of  all  the 
expenses  of  the  road  transporting  it,  including  its  share  of 
interest  upon  capitalization.  If,  however,  by  reason  of  com- 
petition at  terminal  points,  it  is  unable  to  secure  certain  classes 
of  traffic  at  rates  which,  in  comparison  with  the  other  traffic 
upon  the  line,  it  ought  to  receive,  it  will  be  to  the  advantage 
of  the  public  that  it  derive  whatever  revenue  may  be  found 
possible,  so  only  that  it  be  greater  than  the  actual  cost  of  train 


*  farmers  often  wonder  why  a  railroad  should  ever  be  permitted  to  charge 
more  for  hauling  one  way  than  another.  Evidently  it  costs  more  to  haul 
freight  up-hill  than  down-hill.  If  traffic  is  naturally  heavier  in  one  direction 
than  another,  the  railroads  must  be  permitted  to  bid  low  for  freight  which  can 
be  had  at  such  rates,  rather  than  to  haul  back  empty  cars. 


170  THE    FARMER    AS    A    BUSINESS    MAN. 

service  and  repairs.  Railroads  will  even  carry  freight  at  less 
tlian  actual  train  charges,  providing  that  it  tends  to  produce 
other  traffic  which  yields  profit  enough  to  more  than  make  good 
the  original  loss.  If  it  does  not  pay  its  proper  share  of  the 
fixed  charges,  still,  if  it  pays  anything  at  all  towards  them,  it 
by  so  much  reduces  the  necessary  charges  upon  other  traffic. 
This  is  the  principle  upon  which  all  railroad  companies  are 
managed,  and  which  is  accepted  as  sound  by  all  who  are 
familiar  with  transportation  problems.  The  question,  how- 
ever, will  rise,  in  each  case,  whether  or  not  the  rate  fixed  is 
"reasonable"  under  all  the  circumstances,  and  it  is  a  question 
which  should  always  be  decided  by  some  impartial  tribunal, 
and  not  by  the  railroad  authorities;  or  by  the  people  of  any 
interested  community.  It  is  also  proper  to  note  that  there  is 
the  competition  of  markets  to  be  considered,  as  well  as  the 
competition  of  carriers.  There  may  be,  and,  in  fact,  on  long 
railroad  lines  nearly  always  is,  some  commodity  which  will 
not  bear  transportation  at  its  just  proportional  rate,  but  which 
can  be  carried  at  a  rate  which  will  yield  something,  more  or 
less,  towards  the  payment  of  fixed  charges.  In  such  cases 
the  carrier  will  wish  to  transport  it,  and  the  community  which 
produces  it  will  be  desirous  that  it  should,  without  any  regard 
whatever  to  its  propriety  or  impropriety,  when  all  interests 
are  considered. 

Discrimination  between  industries  may  be  illustrated  by 
an  extreme  case.  Upon  tlie  line  of  a  certain  railroad  there 
was  a  limited  amount  of  timber  suitable  for  railroad  ties, 
which  the  company  desired  to  have  kept  there,  and  to  have 
the  price  always  very  low,  so  that  the  ties  could  always  be 
bought  cheaply  for  the  uses  of  the  company.  To  eff'ect  this 
the  company  adopted  the  very  simple  expedient  of  a  prohib- 
itive freight  rate.*  This,  of  course,  was  little  better  than  open 
robbery.  But  there  are  constantly  arising  cases  in  which  a 
company  may  desire  to  favor  or  oppose  the  growth  of  a  partic- 
ular traffic.  A  company  may  have  upon  its  line  a  large  man- 
ufactory from  whose  business  it  derives  a  large  local  revenue. 

*The  Interstate  Commission,  in  this  case,  compelled  the  company  to  make 
its  rate  conform  to  other  lumber  rates. 


THE    FAI^MER    AXD    THE    RAILROADS.  171 

It  would  be  unwilling  to  see  this  factory  crippled  by  outside 
competition,  and  might  therefore  refuse  to  join,  as  part  of  a 
through  line,  in  making  a  reasonable  through  rate  upon 
competing  products.  In  this  case,  and  in  fact  in  nearly  all 
cases  except  discriminations  between  individuals  at  the  same 
shipping  point,  the  interests  of  localities,  individuals,  and 
industries  are  inextricably  involved.  Railroad  controversies 
are  usually,  in  the  main,  conflicts  between  the  people  of  differ- 
ent localities.  It  usually  makes  little  difference  to  a  railroad 
company  how  it  shall  collect  its  revenue,  when  once  the 
amount  has  been  agreed  upon,  although  it  will  preferably 
collect  it  in  accordance  with  the  interests  of  the  immediate 
community  served  by  it.  If,  however,  there  is  a  question  of 
its  obtaining  the  necessary  revenue,  or  if,  as  usually  is  the 
case,  it  is  struggling  for  all  that  can  be  got,  regardless  of 
necessity,  railroad  officials  will  ruthlessly  sacrifice  every  inter- 
est except  that  of  their  company — precisely  as  farmers  or  other 
peo{)le  will  do  under  similar  circumstances.  Railroad  officials 
are  exactly  like  other  people,  except  that  they  are  usually  far 
abler  than  most  of  us.  The  extent  to  which  railroad  officers 
will  go  in  wrong-doing,  the  methods  which  they  will  employ, 
and  the  ability  to  discern  how  closely  the  interests  of  railroads 
are  identified  with  those  of  the  communities  served  by  them, 
depend  wholly  upon  the  individual  character  of  the  men. 
Some  are  far-seeing  and  honorable.  Others  are  narrow  and 
unscrupulous.     In  this,  again,  they  are  exactly  like  farmers. 

My  object  in  what  has  thus  far  been  written  has  been 
simply  to  point  out,  as  clearly  as  m}^  space  will  permit,  that 
the  preparation  of  a  classification,  and  a  rate  sheet  based  upon 
it,  extending  over  a  large  territory  of  diversified  interests, 
which  shall  be  just  to  all  interests  concerned,  presents,  per- 
haps, a  problem  as  complex  as  any  with  which  the  human 
intellect  has  to  deal.  The  practical  question  here  is  in  what 
way  farmers,  and  others  who  are  profoundly  interested,  can 
aid  in  solving  it. 

Certainly  they  can  not  solve  it  themselves.  Railroad  tariffs 
have  been  constructed  by  acts  of  Legislature,  under  the  pres- 
sure of  popular  excitement,  but  such  tariffs  have  been  invari- 


172  THE    FARMER    AS    A    BUSINESS    MAN. 

ably  set  aside  as  unreasonable,  as  they  doubtless  should  have 
been.  Legislatures  can  now  deal  only  with  tariffs  within  the 
state,  which  are  doubtless,  however,  of  great  importance. 

There  are  many  who  favor  government  ownership  of  all 
railroads.  This  would  doubtless  remove  the  abuse  of  passes, 
the  evil  of  stock  jobbing  in  railroad  securities,  corruption  in 
aid  of  private  interests,  and  discrimination  between  individ- 
uals. It  would  not,  however,  remove  the  conflict  between 
local  and  industrial  interests,  which  causes  most  of  our  trouble. 
It  would  merely  transfer  the  combat  to  the  halls  of  the  Legis- 
latures, and  the  private  offices  of  officers  appointed  by  we 
know  not  what  influences.  It  would  involve  an  indebtedness 
of  several  billions  of  dollars,*  upon  which  interest  must  be 
paid,  whether  earned  by  the  properties  or  not,  and  an  increase 
in  the  number  of  employees  of  the  nation  to  the  number  of 
nearly  a  million.  If  the  eight-hour  day  were  insisted  upon, 
and  the  scale  of  wages  fixed  as  in  other  government  employ- 
ment, the  number  of  employees  would  be  largely  increased, 
and  with  it  the  cost  of  transportation.  Of  course  it  could  not 
all  come  at  once,  and  I  have  such  confidence  in  the  common 
sense  and  executive  ability  of  our  people  that  I  feel  confident 
that  the  gravity  of  the  situation  would  compel  soberness  in 
dealing  with  it,  and  tliat  we  should  evolve  a  competent  and 
effective  service.  It  would  take  a  long  time,  cost  a  great  deal 
of  money,  and  many  lives,  but  we  should  do  it.  Frankly, 
however,  as  a  business  proposition,  I  am  unable  to  see  much 
wisdom  in  buying  what  we  can  control  without  buying.  At 
any  rate  it  will  be  time  to  discuss  the  matter  when  seriously 
presented  in  concrete  form,  by  men  who  understand  the  sub- 
ject. We  can  buy  the  roads  whenever  we  decide  that  we  wish 
them.  Most  railroad  owners  would  prefer  United  States  three 
per  cent  bonds  to  their  present  railroad  securities,  and  the  val- 

*  It  is  hard  to  say  how  many  billions.  As  stated  on  pages  IGl ,  102,  the  rail- 
roads of  the  country,  in  1896,  paid  dividends  and  interest  to  the  amount  of  $337,- 
227,538.  This,  at  3  per  cent,  represents  a  capital  of  $11,240,917,933,  which  is 
$1,496,518,001  more  than  the  total  alleged  capitalization  of  all  the  roads- 
watered  stock  and  all.  Capitalized  at  4  per  cent,  it  represents  $8,215,356,725. 
Capitalized  at  5  per  cent  it  represents  $6,744,550,700.  Capitalized  at  6  per 
cent  it  represents  $5,620,458,966.     It  is  a  tidy  sum,  at  all  events. 


THE    FARMER    AND    THE    RAILROADS.  173 

uation  could  probably  be  agreed  upon.  If  we  chose  to  pay  in 
two  per  cent  bonds,  we  could  do  so  by  increasing  the  valuation. 
The  immediate  question  is  of  the  method  of  control.* 
Unjust  control  will  be  defeated  in  the  courts,  as  it  should  be. 
The  Constitution  protects  rich  and  poor  alike,  and  the  rich 
know  how  to  make  its  protection  effective.  Just  control  can 
only  come  from  exact  information,  and  to  this  we  are  entitled. 
The  fundamental  principle  whicli,  as  the  first  step,  must  be 
comprehended,  adopted,  and  acted  upon  is  this:  No  quasi- 
public  corporation  can  have  any  secrets  which  the  public  is  hound 
to  respect.  Upon  this  must  come  the  second  fight.  The  first 
fight  was  over  the  right  to  control.  That  has  been  won  by 
the  people.  Logically,  the  next  step  is  the  knowledge  requi- 
site for  intelligent   control.     That  demand   has   never   been 


*  Many  people,  including  most  railroad  officials,  insist  that  the  public  can 
not  control  the  railroads,  and  that  the  only  practicable  method  of  removing 
the  glaring  evils  which  largely  arise  from  unrestricted  competition  is  to  permit 
competing  roads  to  form  pools,  upon  such  terms  as  they  may  mutually  agree 
upon.  As  they  will  then  have  no  interest  in  underbidding  each  other,  they 
will  have  no  motive  to  continue  the  unjust  discriminations,  which  are  more 
injurious  to  the  public  than  excessive  rates  impartially  applied.  The  Interstate 
Commerce  Commission,  in  its  report  for  1897,  intimates  that  unless  the  power  of 
the  commission  is  to  be  increased,  railroads  may  as  well  be  allowed  to  pool 
under  the  supervision  of  the  commission.  I  am  not  willing,  myself,  to  con- 
cede that  the  large  measure  of  failure  which  has  thus  far  attended  our  efforts 
for  control  proves  that  we  shall  not  ultimately  succeed.  To  a  large  extent  fail- 
ure has  been  due  to  prejudice,  excited  by  agitators  and  demagogues,  leading  to 
popular  demand  for  what  is  not  only  unjust  but  opposed  to  the  interests  of 
those  who  demand  it.  In  the  end  such  demands  come  to  nothing,  but  mean- 
while the  attention  of  the  people  is  distracted  from  the  real  issues,  so  that  no 
popular  support  is  given  to  such  bodies  as  the  Interstate  Commerce  Commis- 
sion which  knows  very  well  how  to  control  the  railroads,  and  will  do  so  if 
the  people  will  compel  their  representatives  to  give  them  the  power.  It  is 
my  belief  that  most  railroads  yvould  welcome  a  control  which  would  control 
competitors  as  well  as  themselves,  provided  that  the  control  be  intelligent  and 
honest.  What  railroads  most  fear  is  control  by  men  who  do  not  understand  the 
transportation  business.  The  short  terms  of  state  railroad  commissioners  expin- 
before  they  have  had  time  to  learn  anything  about  transportation.  Even  the 
Interstate  Commerce  Commission  has  never  had  a  member  who  was  a  trained 
railroad  man.  Probably  no  really  competent  railroad  man  could  be  got  to 
serve  at  present,  as  such  men  would  not  work  for  the  salaries  of  public 
officers.  If  the  time  ever  comes  when  real  power  and  great  honor  attach  to 
these  positions,  trained  railroad  men  of  the  highest  character  will  consent  to 
serve,  just  as  our  greatest  lawyers  accept  appointments  to  the  Supreme  Court  of 
the  United  States  at  salaries  which  are  very  small  compared  with  what  they 
earn  at  the  bar. 


174  THE    FARMER    AS    A    BUSINESS    MAN. 

properly  formulated  that  I  know  of.  The  formula  given  is 
the  proper  one  to  adopt.  As  the  first  step  in  the  education  of 
the  public  it  should  be  adopted,  and  published,  without 
rhetoric,  and  without  passion,  by  every  body  of  farmers  in  the 
land.  By  law,  the  Interstate  Commerce  Commission  has 
power  to  prescribe  methods  of  accounting  to  be  followed  by 
railroads  In  their  interstate  commerce  traffic,  and  the  roads 
seem  generally  to  comply  with  it.  But  there  are  subjects 
upon  which  the  public  demands  details,  which  it  must  insist 
upon  getting.  Details  of  certain  expenditures,  with  a  require- 
ment of  vouchers,  would  be  more  effective  in  the  prevention 
of  improper  practices  than  any  other  method  which  could  be 
adopted.  The  public  is  entitled  to  them  and  should  insist 
upon  getting  them.  Should  occasion  be  found  to  require  it, 
railroad  auditors  should  be  public  officials.  At  any  rate, 
whatever  degree  of  severity  and  coercion  may  be  found  neces- 
sary to  put  the  public  in  possession  of  the  information  required 
for  intelligent  dealing  with  railroads,  should  be  relentlessly 
applied. 

No  intelligent  public  opinion  can  be  created  to  guide 
farmers  or  anybody  else  in  formulating  specific  demands  for 
reform  without  some  knowledge  of  the  facts  and  principles 
involved.  Of  these  farmers  are  now  practically  ignorant. 
What,  from  their  reading  of  inflammatory  literature,  they 
believe  to  be  true,  is  mostly  not  true,  and  what  they  demand 
is  as  apt  to  be  unjust  as  otherwise.  They  can  usually  see  only 
their  own  interests,  and  will  not  understand  that  others,  and 
very  likely  other  farmers,  must  be  considered.  I  know  of  l)ut 
one  place  where  the  American  farmer  can  get  the  information 
which  he  needs  on  this  subject,  and  that  is  i'rom  the  Reports  of 
the  Interstate  and  State  Railroad  Commissions.  The  Reports 
of  the  Interstate  Commission  from  1887  to  date,  give  com- 
plete and  impartial  discussions  of  all  problems  of  interstate 
traffic,  and  the  syllabi  of  the  great  number  of  cases  decided 
give  more  facts  than  can  be  had  anywhere  else.  A  set  of 
these  may  be  found  in  any  good  public  library,  and  can  be 
collected  by  granges  or  individuals.  A  sufficient  inquiry 
would  doubtless  result  in  a  republication  of  these  documents, 


THE    FARMER    AND    THE   RAIfKOADS.  175 

omitting  repetitions.      The  citizens  of  each  state  can  obtain 
the  reports  of  their  own  states. 

Farmers,  while  insisting  upon  disclosure  of  all  railroad 
secrets,  and  fully  informing  themselves  as  to  what  is  now 
known,  should  work  for  the  strengthening  of  the  Interstate 
Commerce  Commission  by  the  legislation  which  it  has  asked 
for,  but  which  Congress  refuses  to  give,  and  for  the  strength- 
ening, in  certain  directions,  of  state  commissions.  In  the 
newer  states  the  railroad  commissions  are  usually  objects  of 
public  contempt— and  this  whether  honest  or  dishonest.  They 
are  usually  expected  to  accomplish  the  impossible,  and  having 
foolislily  accepted  office  must  suffer  the  consequences.  I  do 
not  see  how  a  good  railroad  commissioner  can  ever  be  evolved 
from  the  tumult  of  a  political  convention,  but  it  is  a  fact  that 
good  men  are  often  both  nominated  and  elected  to  those 
places.  The  trouble  is  apt  to  be  with  their  mental  calibre. 
They  are  expected  to  become  advocates,  and  are  not  usually 
able  to  cope  with  the  intellectual  forces  against  them. 

The  true  functions  of  a  railroad  commissioner  are  not 
those  of  an. advocate,  but  of  an  investigator  and  judge.  A 
railroad  commissioner  can  not  make  a  freight  tariff.  He  does 
not  know  how.  Just  classifications  and  rate  sheets  must  be  a 
matter  of  growth.  The  railroads  must  make  their  own  tariffs, 
and  the  commissioners  must  hear  complaints,  and  decide 
them  after  due  hearing,  ordering  such  changes  as  may  seem 
just.  The  decisions  once  made,  and  upheld,  if  contested,  l)y 
the  courts,  must  be  enforced  relentlessly,  and  at  all  hazards, 
by  the  people,  whether  in  favor  of  the  complainants  or  against 
them.  When  decisions  are  just,  as  they  usually  will  be,  the 
railroads  will,  in  nearly  all  cases,  promptly  comply  with  them. 
What  the  farmer  must  do,  therefore,  to  secure  justice  from  the 
railroads,  is:  First,  insist  upon  finding  out  and  publishing 
whatever  the  railroads  desire  to  keep  secret.  Secondly,  study 
the  railroad  question  from  original  official  documents;  no 
other  publications,  especially  if  controversial,  are  of  much 
value.  Third,  insist  upon  strong  national  and  state  commis- 
sions, with  full  power  and  wide  discretion  in  investigation 
and  review.  Fourth,  get  good  men  into  those  positions.  Fifth, 
sustain  them  when  they  are  there. 


CHAPTER    IV. 

THE   FARMER    AND    THE    SPECULATOR. 

THE  science  of  economics  recognizes  the  existence  of 
moral  obligations,  but  does  not  concern  itself  with  their 
enforcement.  It  merely  takes  account  of  economic 
results  following  their  observance  or  non-observance.  That 
"honesty  is  the  best  policy"  is  an  economic,  not  a  moral 
precept,  meaning  that  in  the  long  run  uprightness  is  most 
profitable.  With  the  resemblance,  if  any,  of  speculation  to 
gambling,  or  the  immorality  of  that  practice,  if  it  be  immoral, 
this  work  has  nothing  to  do.  What  I  have  to  consider  in 
this  chapter  is  tlie  economic  result  to  farmers,  of  speculation, 
by  others  than  themselves,  in  the  products  of  the  farm. 

"Speculation  "  is  the  purchase  of  a  commodity  not  needed 
by  the  purchaser  for  consumption  (or  for  sale  to  customers  in 
the  ordinary  course  of  business),  in  the  expectation  that  the 
market  price  will  be  higher;'  or  the  contracting  to  deliver  at 
some  future  time  a  commodity  not  owned  by  the  seller,  in  the 
expectation  that  before  tlie  maturity  of  the  contract  he  will  be 
able  to  purchase  for  delivery  at  a  price  lower  than  that  con- 
tracted to  be  paid  to  him.  The  speculator  who  buys  will 
profit  by  higher  prices,  and  is  interested  in  promoting  them, 
which  he  commonly  does  by  the  persistent  circulation  of  facts 
or  rumors  indicating  a  scarcity  of  the  commodity.  He  is 
called  a  "bull"  from  the  habit  of  that  animal  of  tossing  things 
up  on  his  horns.  He  desires  prices  to  go  up.  More  commonly, 
of  late  years,  he  is  called  "long  of  the  market,"  meaning  that 
he  has  a  supply  of  the  commodity  in  excess  of  his  contracts 
to  sell.  Speculators  who  contract  to  make  future  deliveries 
are  called  "bears,"  from  the  habit  of  tiiat  animal  of  tearing- 
down  things  with  his  claws.  Thoy  wish  prices  to  go  down. 
More  commonly,  of  late  years,  they  are  called  "short  of  the 
market,"  meaning  that  they  own  less  of  the  commodity  than 

(176) 


THE    FAKMER    AND    THE    SPECULATOR.  177 

they  have  contracted  to  deliver.  They  will  be  compelled  to 
buy,  and  desire  to  buy  cheaidy.  They  therefore  promote  low 
prices  by  circulating  facts  and  rumors  indicating  an  excess 
supply  of  the  commodity.  ''Bulls,"  or  "longs,"  are  specu- 
lators for  a  rise  in  prices.  "Bears,"  or  "shorts,"  are  specula- 
tors for  a  fall  in  prices. 

As  speculation  is  commonly  conducted,  the  speculator  for 
a  rise  does  not  actually  receive,  pay  for,  and  store  the  com- 
modity which  he  buys.  This,  if  done  on  any  important,  sale, 
would  require  far  more  capital  than  speculators  usually  pos- 
sess, and  would  also  involve  the  expense  of  actual  delivery, 
storage,  and  insurance.  He  therefore  merely  contracts  tliat 
he  will  receive,  at  some  definite  time  in  the  future,  a  given 
quantity  of  the  commodity  at  a  price  named,  the  seller  con- 
tracting to  deliver.  Although,  in  these  cases,  actual  delivery 
is  contracted  and  can  be  demanded  by  either  party,  neither 
usually  expects  it  to  be  made.  At  the  maturity  of  the  contract 
the  one  who  would  lose  by  its  literal  fulfilment  pays  to  the 
other  the  amount  of  that  loss. 

A  "corner"  occurs  when  the  speculators  who  have  contracted 
to  receive  the  commodity  secure  control  of  the  entire  stock 
available  for  delivery  at  the  time  and  place  agreed  upon. 
Those  who  have  contracted  to  deliver  to  them  can  buy  for 
delivery  only  of  those  who  are  to  receive  it,  who  set  their  own 
price,  which  is  usually  the  highest  which  it  is  estimated  that 
sellers  can  pay.  They  do  not  compel  general  bankruptcy, 
since  that  would  defeat  their  object.  When  actual  and  com- 
plete control  of  a  commodity  has  been  obtained  by  the  bulls, 
the  bears  have  no  recourse  but  to  accept  the  situation  and  settle 
as  best  they  can.  Complete  control  of  any  of  the  most  im- 
portant farm  products,  like  wheat  or  cotton,  is  impossible. 
At  most,  control  can  be  obtained  only  of  the  supplies,  which, 
at  reasonable  expense,  can  be  delivered  at  the  time  and  place 
where  the  contracts  mature.  Outside  these  limits  there  are 
always  supplies  available,  and  if  prices  are  raised  so  as  to 
admit  of  it,  these  will  be  purchased  and  rushed  in  and  tendered 
for  delivery.  These  additional  supplies  must  be  taken  and 
paid  for  in  cash,  or  those  attempting  the  corner  will  fail,  and 
12 


17S  THE    FARMER    AS    A    BUSINESS    MAN. 

l)rices  at  once  collapse.  In  such  cases  payment  of  any  differ- 
ence in  value  is  seldom  accepted,  as  the  object  is  to  supply  the 
commodity  in  such  quantities  that  the  bulls  can  not  raise  the 
money  to  pay  for  it,  when,  of  course,  they  fail,  and  the  corner 
is  broken  in  that  way.  Corners  seldom  succeed,  but  every  few 
years  some  wealthy  combination  of  speculators  attempts  it — 
almost  invariably  with  disastrous  results  to  themselves.  Spec- 
ulation, however,  is  continuous  in  the  leading  farm  products, 
and  the  contest  between  bulls  and  bears  goes  on  forever.  This 
speculative  business  is  conducted  in  public,  after  the  manner 
of  an  auction.  The  rooms  where  the  business  is  transacted 
are  called  "exchanges,"  and  at  a  regular  hour  on  each  business 
day  an  official  "caller  "  calls  off,  one  by  one,  the  list  of  com- 
modities dealt  in  on  that  exchange,  and  pauses  for  members  to 
offer  to  buy  or  sell.  None  but  members  are  admitted  to  trade 
on  the  exchange,  and  these  must  be  known  to  be  responsible. 
BVilure  to  comply  with  any  contract  thus  made  forfeits  mem- 
bership in  the  exchange.  The  business  is  not  commonly 
transacted  by  the  principals  to  the  transaction,  wIjo  usually  do 
not  wish  to  be  known.  The  actual  trading  is  done  by  a  class 
of  men  called  "  brokers,"  who  receive  orders  to  buy  or  sell  the 
commodity,  taking  on  deposit  a  sufficient  sum  to  protect  them- 
selves against  loss.  This  deposit  is  called  a  "  margin."  The 
ordinary  fluctuations  of  leading  commodities  being  small,  the 
deposit  of  a  small  margin  will  enable  the  speculator  to  pur- 
chase a  large  quantity  of  the  commodity.  The  profit  to  the 
brokers  is  their  commission  on  sales  and  purchases,  and  it  is 
the  custom  of  many  of  them  to  flood  the  country  with  circu- 
lars tempting  men  of  small  means  to  attempt  to  get  rich 
suddenly  by  speculating  through  them  on  the  exchanges. 
The  order  is  given,  and  the  deposit  made,  and  notice  is  at  once 
received  that  the  broker  has  bought  so  many  bushels  of  wheat, 
or  barrels  of  pork,  or  bales  of  cotton,  for  account  of  the  one 
ordering,  the  right  being  reserved  to  call  for  more  margin 
should  the  market  require  it,  in  default  of  which  the  com- 
modity may  be  sold.  If  the  market  goes  right,  the  new 
speculator  makes  money.  If  it  goes  wrong,  he  loses  his 
margin.  The  broker  always  protects  himself  by  selling  out 
before  the  margin  is  exhausted. 


THE    FARMER    AND    THE    SPECULATOR.  17!' 

The  above  describes  the  methods  of  transacting  speculative 
business  in  farm  products.  Tiie  question  now  to  be  considered 
is  the  economic  effects  of  the  practice  ui)on  farmers.  As  to 
this  it  is  chiimed  that  farmers  are  benefited  by  the  daily  pub- 
lication of  values,  all  transactions  of  the  exchanges  being 
published  and  widely  circulated  by  the  daily  j)ress.  These 
include  not  only  transactions  in  "spot"  goods,  which,  of  course, 
are  not  speculative,  and  show  actual  current  values,  but  the 
extremes  of  opinion  as  to  probable  values  in  the  future.  There 
is  no  doubt  that  this  is  an  advantage  to  tiie  farmer.  When 
speculative  trading  in  "futures"  of  farm  products  was  taxed 
out  of  existence  in  Germany,  there  was  immediate  complaint 
from  the  farmers  at  whose  instance  it  was  done,  that  they 
could  no  longer  find  out  the  price  of  grain,  but  were  at  the 
mercy  of  dealers  better  informed  than  they.  It  would  seem 
that  the  ordinary  commercial  reports  would  suffice,  but  it  is 
not  possible  to  obtain  accurate  knowledge  regarding  transac- 
tions privately  made,  and  at  best  the  press  reports  give  only 
the  prices  of  the  day,  affording  no  means  of  judging  of  what 
the  best-informed  men  consider  will  be  the  probable  course 
of  the  market. 

When  this  has  been  said,  it  is  difficult  to  find  anything 
further  of  advantage  to  the  farmer  arising  from  speculation  in 
farm  products.  If  it  be  said  that  it  is  to  the  advantage  of 
farmers  to  have  a  large  body  of  men  systematically  engaged 
in  spreading  rumors  tending  to  raise  the  price  of  a  commodity, 
this  is  neutralized  by  the  fact  that  another  body  equally  large 
is  actively  at  work  in  the  opposite  direction.  There  is  the 
further  fact  that  no  reliance  is  to  be  made  U|)on  the  statements 
of  either  party.  The  farmer  is  as  likely  to  be  deceived  to  his 
disadvantage  by  the  one  as  the  other.  What  the  farmer  needs 
above  all  things  is  to  know  the  real  facts  affecting  the  market 
price  of  what  he  has  to  sell. 

Let  us  now  examine  more  closely  as  to  how  a  farmer  in  the 
Mississippi  Valley,  for  example,  would  be  affected  by  a  success- 
ful or  unsuccessful  "corner"  on  wheat  in  Chicago.  In  the 
first  place,  any  speculative  movement  of  this  kind  is  always 
preceded  by  a  long  period  of  quiet  buying  at  the  lowest  possi- 


180  THE    FARMER    AS    A    BUSINESS    MAN. 

ble  prices.  To  avoid  attracting  attention  by  very  large  pur- 
chases by  one  party,  a  large  number  of  brokers  are  employed. 
This  is  continued  as  long  as  possible,  and  it  is  evident  that 
the  farmers  who  thus  part  with  their  wheat  are  not  benefited. 
At  last  the  time  comes  when  it  is  evident  that  some  one  is 
manipulating  the  market,  and  then  comes  a  wild  rush  to 
break  the  price  by  pouring  wheat  into  Chicago  in  such  quan- 
tities that  the  bulls  can  not  raise  money  to  take  and  pay  for  it. 
Whichever  party  wins,  the  result  is  an  enormous  accumulation 
of  wlieat  in  the  Chicago  market,  very  far  in  excess  of  local 
requirements.  When  the  day  of  settlement  arrives,  the  deal 
closes,  and  all  their  accumulated  wheat  is  thrown  upon  the 
market,  to  get  rid  of  the  interest,  storage,  and  insurance  charges 
which  are  eating  it  up.  This  closes  the  usual  outlet  to  farm- 
ers who  still  retain  their  wheat,  and  the  product  remain.^ 
unsalable,  except  at  rates  so  low  that  speculators  see  that  it 
will  be  safe  to  buy  and  hold.  The  only  farmers  wlio  have 
made  money  by  the  speculative  movement  are  those  who  were 
wise  enough  to  sell  during  the  period  elapsing  after  the  attempt 
to  make  a  corner  becomes  evident,  and  before  tlje  market 
breaks,  or  the  day  of  settlement  arrives.  As  farmers  are 
themselves  very  prone  to  speculate,  large  numbers  will  cer- 
tainly refuse  to  sell  when  the  product  is  at  its  higliest,  holding 
on  for  a  still  further  advance.  As  most  attempts  to  corner 
markets  fail,  there  is  almost  sure  to  come,  some  morning,  the 
announcement  that  the  operators  for  a  rise  have  been  unable 
to  fulfil  their  contracts,  and  in  a  twinkling  the  whole  edifice  of 
prosperity  is  gone.  While  the  farmer  has  been  imagining 
himself  rich,  he  has  probably  neglected  his  business  to  watch 
the  market,  and  very  likely  incurred  expenditures  or  obliga- 
tions beyond  his  real  means.  He  will  be  fortunate  if  he  has 
not  also  acquired  bad  habits  which  will  follow  him  through 
life.  Nothing  is  more  demoralizing  than  the  feverish  excite- 
ment of  speculation. 

One  of  the  leading  demands  of  the  Grange  is  a  prohibition 
tax  on  speculative  dealings  in  farm  products.  It  is  an  exceed- 
ingly difficult  problem  to  deal  with,  since  the  speculative 
contracts  do  not,  or  need  not,  ililFer  at  all  in  form  from  legiti- 


THE    FARMER    AND    THE    SPI-X'ULATOR.  181 

mate  contracts,  and  it  is  a  business  necessity  for  millers  and 
other  manufacturers  to  purchase  stock  for  future  delivery,  and 
to  put  up  or  require  margins  or  bonds  to  assure  fulfilment 
of  obligations.  Until  the  transaction  is  closed,  it  can  not  be 
assumed  to  be  speculative.  Legal  ingenuity  will  find  means 
of  evading  the  law.  But  while,  therefore,  effective  enforcement 
of  any  "anti-option"  law  is  hardly  to  be  expected,  it  may  be 
well  to  put  upon  it  the  stamp  of  illegality. 

The  most  effective  means  of  supervising  speculative  trade 
in  farm  products  is  a  wide  diffusion,  among  farmers,  of  their 
actual  value.  This  subject,  including  the  agencies  for  gather- 
ing and  diffusing  this  information,  is  considered  in  other 
chapters  of  this  book. 


CHAPTEK  V. 

•  THE  FARMER  AND  THE  TRADESMAN. 

TRADESMEN — meaning  especially  retail  tradesmen — 
seldom  make  as  much  money  as  farmers  suppose.  In 
the  first  i)lace,  the  actual  cost  of  transacting  a  retail  busi- 
ness will  vary  from  fifteen  to  twenty  per  cent  upon  the  value  of 
the  goods  sold,  depending  upon  the  amount  of  business  done. 
A  very  large  retail  establishment  may  reduce  cost  of  carrying- 
on  business  below  fifteen  per  cent,  and  a  retailer  in  a  town  or 
city  is  in  danger  if  his  cost  runs  above  that.  But  upon  many 
articles,  like  sugar  and  flour,  wliose  wholesale  cost  is  known  to 
the  public,  the  profit  is  usually  less  than  fifteen  per  cent.  It 
is  essential,  therefore,  that  at  least  equal  quantities  shall  be 
sold  at  a  profit  greater  than  is  required  upon  the  average,  to 
cover  the  cost  of  business,  or  it  is  only  a  question  of  time 
when  failure  must  follow.  There  are  also  other  losses,  notabh^ 
bad  debts  and  dead  stock.  The  dealer  will  try  to  purchase 
only  what  he  can  sell,  but  he  is  as  liable  to  error  as  other 
people,  and  accumulates  unsalable  stock,  which  becomes  shelf- 
worn  and  must  be  sold  for  whatever  it  will  bring.  While 
an  estimate  of  fifteen  per  cent  upon  the  "turn  over"  may  be 
assumed  to  cover  depreciation  and  bad  debts,  whether  or  not 
it  actually  does  so  depends  mainly  on  the  good  judgment  of 
the  tradesmen.  A  little  calculation  will  make  this  plainer. 
If  a  small  dealer  puts  $3,000  into  stock,  and  "turns"  his  capital 
three  times  a  year,  his  annual  sales  will  be  |9,000,  upon  which 
fifteen  per  cent  will  be  only  ^450.^  It  is  evident  that  in  a  busi- 
ness conducted  on  so  small  a  scale,  fifteen  per  cent  will  not 
pay  cost  of  transacting  it,  but  with  an  average  profit  of  twenty- 
five  per  cent,  yielding  $750,  the  dealer  can  live,  if  he  has  help 
in  his  own  family,  and  does  not  make  too  many  bad  debts. 
For  retail  stores,  such  as  the  farmer  most  commonly  deals 
with,  an  average  profit  of  twenty-five  per  cent  is  necessary  if 

(182) 


THE    FARMER    AND    THE    TRADESMAN.  183 

the  business  is  to  be  profitable.  As  the  volume  of  business 
increases,  the  percentage  of  expense  runs  down  very  rapidly, 
and  in  such  wholesale  trades  as  I  am  most  familiar  with,  may 
not  exceed  five  per  cent.  A  gross  profit  of  ten  per  cent  on 
staple  goods  is  quite  satisfactory  to  wholesale  merchants. 

The  retailer  who  sets  out  to  make  his  profits  average 
twenty-five  per  cent  of  his  sales,  must  charge  a  very  much 
greater  profit  on  many  of  his  goods,  since  competition  compels 
the  sale  of  many  staple  goods  so  low.  The  large  profits  are 
made  on  goods  whose  cost  is  not  generallj'^  known,  such  as 
olive-oil,  extracts,  "repairs"  to  farm  machinery,  and  num- 
berless other  articles  of  the  kind.  Upon  the  whole,  it  seems 
to  me  that  the  small  retail  tradesman  is  about  in  the  situation 
of  the  farmer.  His  invested  capital  is  the  price  which  he  pays 
to  assure  himself  permanent  employment.  If  he  ever  sells  out 
his  business,  he  will  be  luck}'^  to  get  his  money  back.  Very 
few  accumulate  mucl),  although  the  percentage  of  accumu- 
lating men  in  retail  trade  is  doubtless  in  excess  of  that  among 
farmers. 

A  good  retail  dealer  is  a  great  convenience  in  a  country 
neighborhood.  If  it  were  not  for  one  in  the  vicinity  of  my 
home,  we  might  sometimes  have  to  send  twenty  miles  for  a 
spool  of  tliread — the  seamstress  meantime  waiting.  But  if  the 
retailer  is  to  stay  there,  he  must  live,  and  if  the  most  of  the 
trade  goes  to  larger  towns,  or  to  wholesale  stores  in  the  city, 
he  must  necessarily  charge  roundly  for  whatever  goods  he  does 
sell.  Especially,  if  the  most  of  those  who  can  pay  cash  carry 
tlieir  trade  to  the  city,  leaving  him  only  the  trade  of  the  slow, 
pay  or  never-pay  customers,  eked  out  by  odds  and  ends  from 
the  better  class,  he  is  absolutely  compelled  to  charge  prices 
to  cover  the  risk,  and  he  does.  Some  dealers  of  this  class 
are  very  shrewd,  and  encourage  indebtedness  until  the  time 
finally  comes  when  they  demand  a  mortgage,  which,  later, 
they  foreclose. 

The  real  question  for  farmers  to  consider  is,  how  they  can 
best  assure  the  convenience  of  good  retail  stores  in  their 
vicinity,  without  paying  exorbitant  prices  for  their  goods 
There  are  two  courses  open :  they  may  continue  to  take  their 


184  THE    FARMER    AS    A    BUSINESS    MAN.    • 

cash  to  the  larger  market,  and  uncomplainingly  pay  the  high 
prices  for  whatever  they  are  compelled  to  buy  locally,  or  they 
can  contract  to  give  the  local  store  all  their  trade,  paying  cash, 
at  an  agreed  profit  upon  actual  cost  to  the  dealer.  When 
the  trade  of  an  individual  is  large,  this  last  arrangement  can 
ordinarily  be  made,  provided  the  dealer  feels  confident  that 
nothing  will  be  said  about  it.  It  will  not  usually  pay  him 
to  get  only  one  customer  at  the  expense  of  letting  the  whole 
neighborhood  know  his  scale  of  profits.  It  is  quite  customary 
— and  it  is  an  excellent  custom— for  granges,  or  other  farmers' 
societies,  to  buy  at  wholesale,  for  cash,  and  distribute  to  their 
members.  It  will  frequently,  if  not  usually,  happen  that  quite 
as  much  profit,  and  far  more  convenience,  will  be  gained  by 
working  the  trade  through  the  local  dealers.  In  the  first 
place,  the  dealer,  if  in  good  credit,  can  usually  buy  cheaper 
than  any  grange.  It  is  entirely  common  for  granges  ordering 
from  wholesale  dealers,  to  imagine  themselves  to  be  getting 
the  lowest  net  rates,  when,  as  a  matter  of  fact,  a  local  dealer 
may  be  regularly  receiving  a  percentage  on  all  their  purchases. 
There  are  many  wholesale  firms  which  will  fill  orders  from 
such  bodies  at  what  they  term  "wholesale  rates,"  and  credit 
any  customer  in  the  town  with  a  fair  profit  on  the  transaction, 
or,  if  there  be  two  customers,  divide  it  between  them.  The 
reason  is  that  the  trade  customer  buys  more  goods  than  the 
farmers,  and  is  likely  to  buy  much  larger,  and  it  will  not  pay 
to  ofi'end  him  for  the  profit  to  be  made  on  a  few  direct  orders 
from  those  who  should  be  his  customers. 

Still,  if  the  grange  buyers  spend  time  enough  and  study 
enough  to  keep  fully  in  touch  with  the  market,  they  can 
obtain,  for  such  ordinary  goods  as  they  buy,  lower  prices  than 
the  local  dealer  can  make  for  them  under  any  circumstances. 
They  can  hunt  until  they  find  some  wiiolesaler  from  whom 
the  local  dealer  does  not  buy,  and  who  will  not  therefore  care 
about  "protecting"  his  trade.  Even  this,  however,  is  not 
certain.  I  have  known  a  wholesale  house  to  fill  such  an 
order,  and  credit  a  profit  to  a  dealer  who  was  not  dealing  with 
them  at  all.  A  little  later,  of  course,  the  dealer's  trade  will 
be  solicited,  and  some  part  of  it  probably  obtained.     It  wiil 


THE  FARMER  AND  THE  TRADESMAN.  185 

take  farmers  a  long  time  to  understand  all  the  tricks  of  trade. 
It  is  a  question  whether  it  will  not  pay  them  best  to  woi-k 
with  the  local  dealer.  It  depends,  of  course,  upon  circum- 
stances, but  as  a  rule  I  think  most  money  will  be  made  in 
that  way  by  the  farmers. 

But  one  thing  is  sure:  if  the  farmer  becomes  seriously 
indebted  to  the  local  tradesman  he  will  pay  roundly  for  his 
folly.  This  is  not,  necessarily,  because  the  dealer  is  a  grasp- 
ing, hard-hearted  man,  but  because  he  must  charge  high 
prices  to  pay  for  the  risk.  For  some  of  the  goods  sold  on 
credit  he  will  never  be  paid.  He  can  not  tell  which  these  will 
be,  or  usually  would  not  sell  them,  but  it  is  a  necessity  of  busi- 
ness that  those  who  pay  must  help  to  support  those  who  do 
not.  The  dealer  can  not  bear  the  entire  burden.  Those  who 
can  pay  cash,  however,  need  not  pay  any  part  of  these  bills 
unless  they  choose  to.  If,  as  already  said,  one's  trade  is  large, 
he  can  manage  this  matter  individually.  If  it  be  small,  he 
can  only  obtain  this  benefit  by  combination  with  his  fellows. 

I  have  but  one  tiling  farther  to  say  upon  this  subject,  which 
is  that  all  retail  trade  is  infected  with  fraud.  If  a  farmer  buys 
ground  coffee  or  spices,  oils,  paints,  or  even  flour  and  sugar, 
he  can  not  be  certain  that  he  gets  what  he  pays  for.  The 
demand  of  the  farmer  for  "cheap  goods"  induces  extraor- 
dinary efforts  to  supply  it.  This  is  done  by  manufacturers 
who  adulterate  goods,  or  skimp  the  weight  of  packages  at  the 
demand  of  retail  dealers  who  wish  to  be  thought  to  sell 
cheaply.  It  is  well  to  beware  of  all  who  pretend  to  offer  extra 
inducements  in  the  way  of  prices.  The  manufacturers  and 
wholesalers  usually  make  no  more  money  on  sophisticated 
goods  than  upon  those  which  are  honestly  made,  or  put  up. 
The  retailer,  if  he  at  all  understands  his  business,  knows  per- 
fectly well  what  he  is  buying.  He  should  be  held  rigidly 
accountable  to  customers  for  quality  and  weight.  All  persons 
dealing  with  concerns  having  a  special  reputation  for  low 
prices  should  faithfully  check  off  goods  bought  by  weight  or 
measure.  The  cost  of  goods  is  about  the  same  to  all  retailers 
in  good  credit,  and  except  as  they  transact  specially  large 
volumes  of  business,  their  scale  of  profits  must  be  about  the 


186  THE    FARMER    AS    A    BUSINESS    MAN. 

same.  Still  it  is  true  that  the  retailer  with  a  surplus  of 
available  cash-  capital  can  save  money  in  buying,  just  as  the 
farmer  can.  No  general  rules  can  be  laid  down  other  than 
those  already  suggested,  as  to  the  best  profitable  methods  of 
dealing  with  retailers.  It  will  depend  upon  the  circumstances 
of  each  case. 


CHAPTER  VI. 

THE  FAEMER  AND  THE  TAX-GATHERER. 

IT  has  become  evident  that  the  pressure  of  taxation  in  the 
United  States  is  to  increase  until  our  burdens  are  quite 
equal  to  those  of  the  European  people.  There  is  a  ten- 
dency to  demand  a  constantly  increasing  service  from  the 
national,  state,  and  local  governments,  and  all  this  service 
costs  money.  We  shall  certainly  push  these  demands  until 
we  have  reached  the  limit  beyond  which  the  people  will  not 
endure  taxation.  The  fact  that  there  is  such  a  limit,  not 
difficult  to  reach,  impairs  the  credit  even  of  the  richest 
nations,  in  regard  to  what  may  be  termed  questionable  forms 
and  occasions  of  indebtedness.  Universal  experience  shows 
that  when  a  certain  limit  of  taxation  has  been  reached,  a 
nation,  or  any  political  subdivision  thereof,  will  repudiate 
its  indebtedness.  It  will  usually  be  possible  to  raise  some 
quibble,  or  even  some  equitable  contention,  but  at  any  rate  no 
people  will  tax  itself  above  a  certain  limit.  So  long  as  public 
funds  are  expended  in  sucli  a  manner  as  to  make  an  equiva- 
lent saving  in  private  expenditure,  the  limit  of  taxation  may 
be  extended  indefinitely.  If  they  are  expended  wastefulh',  the 
limit  will  be  reached  whenever  the  public  burden,  added  to 
the  necessary  private  expenditure,  according  to  the  prevailing 
standard  of  life,  consumes  the  income  of  the  average  man. 
When  a  people  is  brought  to  a  choice  between  evading  a 
portion  of  the  public  debt,  or  permanently  reducing  the 
standard  of  life,  it  will  not,  if  it  can  be  avoided,  adopt  the 
latter  alternative. 

While  we  are  as  yet,  happily,  far  within  the  limit  of  endur- 
ance of  taxation,  it  is  never  too  early  to  take  into  consideration 
the  fact  that  there  is  a  limit,  or  to  remember  that  every  dollar 
wasted  in  the  expenditure  of  public  funds  is  a  dollar  less  to  be 
expended  for  tlie  comfort  of  him  who  has  earned  it.     In  this 

(187) 


188  THE    FARMER    AS    A    BUSINESS    MAX. 

country  there  is  great  waste  of  public  money — more,  doubtless, 
than  in  any  other  nation  of  the  blood  of  the  thrifty  nations  of 
Nortliern  Europe.  This  is  not  because  we  are  not  intelligent 
and  vigorous,  but  because  our  past  has  been  to  us  a  time  of 
great  things,  and  we  have  been  too  busy  and  too  prosperous  to 
feel  the  necessity  of  economy  in  public  affairs.  The  oppor- 
tunity, as  always,  has  brought  forth  the  men,  and  we  have 
developed  a  class,  larger  and  more  astute  than  exists  elsewhere 
of  the  same  sort,  wliich  expects  to  thrive  at  the  unnecessary 
expense  of  the  public.  Habits  have  been  formed,  and  prec- 
edents set,  which  we  now  find  it  difficult  to  get  rid  of. 

Our  fiscal  misfortunes  include  inequalities  of  taxation 
and  extravagance  in  expenditure;  and  extravagance  may  in- 
clude economical  expenditure  for  desirable  objects,  when 
beyond  the  means  of  the  community  incurring  it.  It  is  no 
more  possible  to  the  poor  community  than  to  the  poor  indi- 
vidual to  practice  all  the  economies  of  wealth.  A  rural 
community  might  bankrupt  itself  by  the  building  of  a  stone 
road  or  an  irrigation  system,  in  the  absence  of  other  capital  to 
make  use  of  them.  There  must  be  traffic  to  justify  the  stone 
road,  and  the  use  of  lands  to  justify  the  building  of  an  irri- 
gation system,  and  both  these  involve  large  investments  of 
capital  in  addition  to  the  cost  of  the  improvements. 

It  is  doubtless  true  that  few  taxes  are  justly  assessed.  Inci- 
dentally I  have  said  something  about  our  system  of  taxation 
elsewhere  in  this  volume.*  I  do  not  intend  to  add  much  to 
what  has  been  said  there.  We  are  committed  to  the  system 
of  raising  most  of  our  taxes  for  state  and  local  purposes  by  an 
ad  valorem  assessment  upon  what  is  called  the  "  value"  of  all 
property  which  can  be  found.  Experience  shows  that  property- 
holders  will  lie  to  get  rid  of  taxation,  and  that  the  number 
who  do  tills  is.  so  great  that  it  is  a  physical  impossibility  to 
deal  properly  with  the  criminals.  In  medieval  times  the 
thumbscrew  and  the  iron  boot  were  employed  in  assessing 
rich   men.f      Even    those   methods   seem   not   to   have   been 


*  See  book  Sixth,  chapters  I  and  IV. 

t  Farmers,  and  other  comparatively  poor  men,  doubtless  pay  an  undue  share 
of  taxes,  but  it  is  mainly  because  they  can  not  conceal  their  property.     When 


THE    FARMER    AND    THE    TAX-GATHERER.  189 

effective.  At  any  rate,  they  have  been  abandoned,  and  none 
better — at  least  more  effective— have  been  discovered.  I  pre- 
sume it  may  be  acce[)ted  as  impossible  to  get  an  approxi- 
mately correct  list  of  property  for  the  purposes  of  an  ad  valorem 
assessment,  and  tjiat  increasing  financial  pressure  will,  in  the 
end,  compel  us,  as  all  other  countries  are  compelled,  to  rely 
more  and  more  on  licenses,  income  taxes,  inheritance  taxes, 
taxes  upon  traffic,*  and  the  like,  to  produce  a  revenue.  Cer- 
tainly I  see  little  use,  within  the  limits  of  a  chapter,  to  try 
to  suggest  remedies  for  the  evils  of  ad  valorem  taxation,  which 
have  baffled  the  ingenuity  of  generations  of  statesmen. 

It  will  be  more  profitable  to  consider  some  possibilities  of 
economy  in  expenditure. 

One  great  source  of  waste  is  the  salary  account.  For  that 
part  of  its  work  which  involves  little  or  no  exercise  of  discre- 
tion, and  no  financial  responsibility,  the  American  public  pays, 
probably,  nearly  twice  what  private  concerns  would  pay  for 
the  same  work.  Under  proper  conditions  the  same  men  who 
now  do  tlie  work — or  as  many  of  them  as  would  be  necessary — 
would  undertake  to  do  all  the  work  that  is  now  done,  for  two- 
thirds  the  present  total  expenditure,  and  in  so  doing  would  be 


they  can  do  so  they  are  as  had  as  others.  The  iiumher  of  pounds  of  wool  pro- 
duced in  California  in  1896,  us  compiled  hy  the  wool  dealers,  divided  hy  the 
number  of  sheep  assessed  in  the  state,  gives  the  average  clip  of  about  fifteen 
pounds  per  head.  The  real  average  could  not  have  exceeded  seven  and  one-half 
pounds,  which  would  show  that  sheep  owners  lied  about  the  number  of  their 
sheep.  In  that  state  "Angora"  goats  are  assessed  higher  than  "common  " 
goats, and  the  assessors,  in  1896,  could  find  but  eight  thousand  two  hundred'and 
thirty-four  such  goats  in  the  state.  The  largest  breeder  wrote  me,  at  the  time, 
that  there  were  not  less  than  seventy  thousand  Angoras  in  the  state.  In  my 
own  county  not  a  single  "Angora"  was  returned,  and  yet  I  personally  know 
of  two  large  flocks  and  there  are  doubtless  others.  To  save  a  little  tax  the 
goats,  none  of  them  less  than  half  bred,  were  listed  as  "common  "—and  the 
lists  were  sworn  to. 

♦We  now  tax  incoming  foreign  traffic,  collecting  the  tax  at  the  port  of 
entry.  It  has  been  proposed  than  Congress  tax  interstate  traffic,  relying, 
apparently,  on  the  books  of  the  railroad  companies  for  the  assessment,  the 
railroads,  of  course,  to  pay  the  tax.  This,  at  any  rate,  would  have  the  advan- 
tage of  definitely  separating  interstate  and  intrastate  traffic,  so  that,  in  assessing 
for  state  purposes,  the  revenue  derived  from  state  traffic,  and  assessable  there, 
could  be  known. 


190  THE    FARMER    AS    A    BUSINESS    MAN. 

far  better  off  than  they  now  are.  They  would  have  a  career, 
modest  or  otherwise,  according  to  tlieir  abilities,  but  something 
to  be  depended  u})on.  At  present,  outside  the  services  to 
which  what  are  known  as  the  "civil  service  "  rules  are  applied, 
I  hardly  know  a  more  unfortunate  lot  than  that  of  a  bright 
young  man  who  has  obtained  a  place  in  the  public  service. 
As  a  rule  these  men  are  quite  capable  of  sustaining  themselves 
in  private  life,  for  it  requires  a  good  deal  of  vigor,  wisely  or 
unwisely  displayed,  to  get  into  the  public  service,  and  the 
result  is  quite  likely  to  be  the  wreck  of  a  useful  man.  The 
two  or  four  years  of  public  employment  are  quite  sufficient  to 
sever  his  relations  with  the  business  world,  and  impart  tastes 
and  habits  incompatible  with  business  success.  Then  comes  a 
new  election,  with  a  change  of  appointing  power,  and  the  man 
is  left  stranded,  to  begin  life  over,  with  no  openings  which  he 
does  not  force.  Very  few  in  public  service  find  themselves  able 
to  save  money.  They  are  not  permitted  to  save  it.  They  get 
their  places  as  a  reward  for  party  service,  and  the  party 
will  demand  all  that  tliey  might  otherwise  save.  In  corrupt 
municipalities  the  tribute  may  be  in  direct  monthly  payments 
to  the  "boss"  who  secures  the  place  and  holds  the  man  in  it. 
More  often  it  goes  in  party  "assessments,"  and  constant  small 
expenditures  to  maintain  acquaintance  and  "influence."  A 
large  number  of  public  employees  regularly  anticipate  their 
salaries  by  pledging  them,  at  a  heavy  discount,  to  brokers. 
A  party  has  little  use  for  a  frugal  man.  He  must  spend  his 
money,  or  out  he  goes. 

From  the  standpoint  of  the  public,  the  aspect  is  equally 
bad.  The  appointing  officer  usually  has  ten  men  to  whom  he 
is  under  "obligations"  for  one  that  he  can  appoint.  He 
contrives  places  for  as  many  as  he  can  at  the  public  expense. 
Perhaps  lie  is  himself  an  appointed  officer,  and  under  obliga- 
tions to  look  out  for  the  dependents  of  the  man  above  him. 
Appointed  state  officers  have  told  me  that  the  work  in  their 
charge  cost  twice  as  much  as  it  should,  by  reason  of 
"requests"  from  governors  and  state  party  committee  men, 
which  were  equivalent  to  demands.  Places  must  be  found 
for   certain    men,  and   if  they  did  not   exist,  they  must   be 


THE    FARMER    AND    THE    TAX  (JATllERER.  191 

created.  A  private  printing  office  will  send  out  its  proofs,  and 
make  small  deliveries  of  work,  by  means  of  boys  and  young 
men  at  from  $0.00  to  $10  per  week,  and  one  such  boy  will 
serve  many  customers.  As  I  write,  this  morning's  paper  tells 
me  that  one  house  of  our  Legislature  has  three  "  messengers 
to  the  state  printer" — located  in  the  State  House  grounds — at 
$3.00  per  day  each,  and  two  mail  carriers  at  the  same  salary. 
This,  of  course,  is  robbery,  pure  and  simple,  for  which  the 
party  in  the  majority  is  responsible.  When  the  other  party  is 
in  power  it  plunders  in  the  same  way,  and  is  also  responsible. 
There  is,  in  a  certain  state,  a  state  printing  office.  As  I  write, 
I  see  in  the  morning  paper  an  offer  from  a  responsible  firm  to 
take  over  the  office  and  plant,  pay  a  fair  rent  for  it,  pay  the 
same  wages  that  are  now  paid  to  all  employees  needed,  and  do 
the  same  work,  for  $100,000  per  annum  less  than  the  state  now 
pays,  with  no  rental  charge.  A  law  of  the  state  requires  that 
all  printing  for  state  institutions  must  be  done  at  the  state 
printing  office.  A  week  since  an  officer  of  the  State  University 
told  me  that  he  was  seeking  to  get  that  institution  excepted 
from  the  rule,  as  it  could  get  its  work  done  for  one-third  the 
sum  charged  against  the  university  appropriation  by  the  state 
printing  office.  In  the  city  where  I  spend  part  of  my  time, 
the  usual  working  hours  for  clerks  are  from  8  a.  m.  to  6  p.  m., 
with  the  usual  lunch  time,  two  weeks'  vacation  in  the  year, 
with  no  deduction  of  pay,  and  occasionally,  of  course,  a  half 
day  off  when  business  is  light.  The  compensation  will  pos- 
sibly average  $75  per  month.  At  the  City  Hall  the  depart- 
ment clerks  work  from  9  a.  m.  to  5  p.  m.  There  are  many  more 
than  are  needed  in  some  of  the  offices.  The  report  before  me 
does  not  give  the  individual  salaries,  but  they  will  doubtless 
average  $100  per  month.  In  a  road  district  in  a  certain 
county,  I  have  known  a  road  master  who  employed  his 
own  sons  and  his  own  team,  to  leave  his  liome  at  8  in  the 
morning,  drive  slowly  five  miles  to  his  work,  take  his  hour  for 
lunch,  and  leave  in  time  to  reach  home  by  five  in  the  after- 
noon, the  law  making  eight  hours  a  "  day's  work."  The  pay 
was  $200  per  day  per  man,  or  $4.00  for  man  and  team. 
Wages  in  the  same  community  have  never  been  higher,  for 


192  THE    FARMER    AS    A    BUSINESS    MAN. 

single  day's  work,  than  $1.50  per  day,  without  board,  for  ten 
hours'  work,  the  laborer  to  come  and  go  outside  of  working 
hours.  The  hours  for  department  clerks  in  Washington,  if  I 
remember  correctly,  ar'5  from  9  a.  m.  to  3  p.  m.  Opposite  a 
house  where  I  once  lived  for  a  time,  was  a  small  city  park. 
Two  gardeners  were  employed  in  it,  probably  at  $75  per 
month  each.  It  was  a  matter  of  never-failing  interest  to  the 
families  whose  dwellings  fronted  on  the  park,  to  see  the 
ingenious  ways  which  those  men  adopted  to  seem  to  be  at 
work,  and  yet  not  work.  There  was  real  work  for  about  one 
man  half  the  time. 

The  plundering  of  the  public  through  party  machinery, 
by  means  of  unnecessary  employees,  shorter  hours,  and  higher 
wages  than  are  paid  by  private  employers,  is  })erennial  and 
fearful.  On  the  other  hand,  the  higher  positions,  requiring 
special  attainments  or  involving  great  responsibilities,  are 
sometimes  not  paid  enough.  The  Secretary  of  Agriculture 
states  that  it  is  usually  not  possible  for  his  department  to 
retain,  in  the  scientific  divisions,  the  best  men  which  the 
service  develops.     Higher  salaries  elsewhere  draw  them  away. 

The  responsibility  for  this  state  of  things  lies  upon  the 
people — upon  me  who  write  this,  and  upon  the  reader  who 
reads  it — there,  and  upon  those  like  us,  and  nowhere  else. 
It  is  as  much  my  business  and  yours,  reader,  as  that  of  any- 
body else,  to  endeavor  to  put  a  stop  to  it.  The  managing 
editor  of  a  great  daily  paper  lately  said  to  me  that  it  could 
not  be  stopped.  That  is  not  true.  We  not  only  can  stop  it, 
but  we  shall  do  so — when  poverty  compels  us,  and  not  before. 
So  long  as  we  can  endure  the  plundering,  we  shall  permit  our- 
selves to  be  plundered. 

But  in  the  meantime  we  can  lay  down  the  principles  upon 
which  we  must  proceed  when  we  decide  that  we  have  been 
plundered  long  enough.  We  can  discuss  them  in  our  granges 
and  other  assemblies.  We  can  formulate  our  conclusions,  and 
publish  them  in  the  local  press,  and  thus  educate  the  people. 
Finally  we  can  pledge  the  delegates  whom  we  send  to  political 
conventions  to  seek  to  incorporate  them  in  party  platforms, 
and  pledge  candidates  for  office  to  work  for  them  and  abide 


THE  FARMER  AND  THE  TAX-GATHERER.        193 

by  them.  Then,  regardless  of  party,  we  can  vote  against 
candidates  wlio  evade  definitely  committing  themselves  to 
them.  Honesty  and  economy  in  public  affairs  are  more  im- 
portant than  the  success  of  any  party.  The  farmers  can  be 
and  should  be  the  leaders  in  this  movement.  Among  the 
farmers,  let  any  man  lead  who  is  impressed  with  tlie  necessity. 
If  he  is  clear  and  definite,  he  will  be  astonished  at  the  follow- 
ing he  will  have. 

The  lines  upon  which,  only,  reform  can  be  expected,  are 
the  following: — 

1.  A  permanent  career  for  the  civil  servant.  A  railroad 
clerk  may  expect  to  retain  his  ^wsition  as  long  as  he  lives. 
He  learns  his  business,  and  expects  to  live  by  it.  Railroad 
presidents  come  and  go,  but  the  clerk  stays.  It  does  not  pay 
to  break  in  new  hands.  If  he  develops  ability,  he  may  expect 
promotion,  but  at  any  rate,  if  he  is  faithful,  he  is  sure  of  his 
position.  He  can  therefore  afford  to  work  for  a  small  salary, 
and  for  full  hours,  and  he  does. 

2.  Hours  of  work,  and  rate  of  compensation  to  correspond 
with  current  usages  in  private  business.  This  will  involve 
reduction  of  salaries  in  jwsitions  involving  routine  work,  and 
increase,  in  some  cases,  for  positions  requiring  great  vigor, 
judgment,  and  organizing  or  executive  ability.  It  will  not 
pay  the  public  to  let  private  business  absorb  our  ablest 
business  men. 

3.  Entrance  to  the  service  and  promotion  in  it  up  to 
certain  grades,  to  be  upon  competitive  examination.  This, 
except  for  positions  requiring  technical  knowledge,  merely 
insures  that  the  public  servants  shall  be  intelligent  men  and 
women,  with  a  good  amount  of  vigor,  for  it  requires  vigor  to 
succeed  in  any  competition.  It  does  not  assure  honesty, 
executive  ability,  or  judgment.  It  is  certain,  however,  that 
from  the  body  of  an  intelligent  civil  service,  there  will 
develop  a  sufficient  number  of  those  possessing  those  equalities 
to  fill  all  the  positions  requiring  them.  The  rest  will  remain 
as  they  are,  faithfully  and  contentedly  fulfilling  the  duties  for 
which  they  are  competent.  The  worst  possible  method  of 
entering  the  public  service  is  by  means  of  a  political  pull.     A 

13 


194  THE    FARMER    AS    A    BUSINESS    MAN. 

better  method  than  that  would  be  to  assign  all  the  places  to 
persons  with  red  hair,  permitting  them  to  draw  lots,  if  the 
number  offering  were  more  than  were  needed.* 

Politicians  of  all  parties  are  bitterly  opposed  to  such 
reforms.  The  most  common  argument  is  that  it  will  create 
an  "aristocratic  class."  Those  who  employ  this  argument 
usually  know  that  it  has  no  merit,  but  they  trust  to  the 
stupidity  and  prejudice  of  the  general  public  to  gain  their 
ends.  "Aristocracies"  can  never  be  supported  upon  the  sala- 
ries which  are  paid  in  private  life,  and  which  the  public  ought 
to  pay,  for  routine  work — and  nine-tenths  of  the  public  service 
is  of  that  character.  On  the  contrary,  except  to  the  very  few 
who  win  promotion,  not  only  by  faithful  service,  but  marked 
ability,  the  service  is  of  a  very  humble  character.  The  public 
servant  becomes  part  of  a  machine.  He  loses  individuality 
and  initiative.  His  name  is  not  known  outside  his  immediate 
circle.  By  strict  economy  only  can  he  make  financial  ends 
meet.  But  his  future,  such  as  it  is,  is  assured.  He  has  chosen 
a  humble  lot  and  abides  by  it,  doing  his  work  faithfully 
therein.  No  private  employer  would  discharge  such  a  servant 
without  cause.  Why  should  the  public  be  less  merciful  than 
individuals  in  it?  It  is  true  that  the  public  service  should  be, 
and  in  well-regulated  civil  service  it  is,  evidence  of  honesty 
and  faithfulness.  But  an  "aristocracy"  based  solely  on  those 
qualities,  and  bound  by  what  is  practically  a  vow  of  perpetual 
poverty,  is  not  a  bad  thing. 

There  is  somewhat  more  force  in  the  argument  that  in  a 
republic  it  is  desirable  that  as  large  a  number  as  possible 
become  famihar  with  the  details  of  public  business,  and  that 
changing  employees  with  every  election,  or  "rotation  in  office," 
as  it  is  called,  accomplishes  that  end.  That  it  is  well  for  citi- 
zens to  know  all  about  the  public  business  is  true,  but  if  knowl- 


*  The  mere  establishment  and  enforcement  of  what  are  known  as  the  "civil 
service  rules"  for  entrance  and  promotion  will  not,  of  itself,  cure  the  evil.  It 
is  but  one  step.  There  will  still  be  intrigue  to  create  unnecessary  places  on 
the  part  of  those  who  think  themselves  likely  to  obtain  them.  There  must 
also  be  legislation  compelling  public  employees  to  keep  ordinary  business 
hours,  and  requiring  a  rigid  accounting  for  time. 


THE  FARMER  AND  THE  TAX-GATHERER.         19;") 

edge  is  to  be  Lad  only  at  the  cost  of  an  extravagant  administra- 
tion of  that  business,  the  ruin  of  the  majority  of  the  public- 
servants,  and  the  general  demoralization  of  the  [)eo[)le  them- 
selves, the  price  is  too  high. 

By  taking  the  business  affairs  of  the  public  entirely  out  of 
politics,  the  expense  of  administration  of  all  national,  state 
and  local  affairs  can  be  enormously  reduced,  and  the  demands 
of  the  tax-gatherer  correspondingly  lessened. 

To  the  above  I  Vv^ould  add  the  letting  all  public  work  bv 
contract  which  is  possible  to  be  so  disposed  of.  This  is  bitterly 
opposed  by  all  organized  labor,  which  insists  that  all  pu])lic 
work  shall  be  done  by  "day's  works,"  at  higher  wages  and 
shorter  hours  than  those  usual  in  private  life.  Many  of  those 
advocating  this  method  are  unquestionably  patriotic  citizens, 
and  yet  they  seem  to  me  to  err  greatly  in  permitting  their  zeal 
for  the  welfare  of  one  class  to  outweigh  their  desire  for  the 
welfare  of  the  public.  They  know  that  what  they  seek  leads 
not  only  to  higher  wages  for  those  employed,  which  we  might 
not  complain  of,  since  the  public  should  aid  in  maintaining 
the  standard  of  life  of  the  laborer,  but  in  the  employment  of 
unnecessary  men,  and  consequent  shirking  of  work  to  make 
room  for  as  many  as  possible,*  and  the  general  debauching  of 
public  morals.  It  seems  to  me  that  they  would  have  a 
stronger  and  more  effective  claim  upon  the  public  regard,  and 
its  aid  in  accomplishing  their  legitimate  desires,  by  aiding  to 
secure  purity  and  efficiency  in  the  public  service.  I  work 
twelve  hours  in  the  day,  upon  the  average,  and  always  have 
done  so.  I  am  not  willing  to  work  thus  to  pay  a  man  for 
working  eight  hours,  and  half  working  at  that,  in  mending 
the  road  which  runs  past  my  house. 

This  entire  volume  could  be  filled  with  detailed  suggestions 
for  eluding  the  tax-gatherer  by  promoting  more  economical 
methods  in  public  affairs.     Any  reader,  when  he  considers  the 


*0f  course  there  is  a  certain  portion  of  the  non  tax-paving  element,  espe- 
cially in  large  cities,  which  undisguisedly  seeks  the  lavish  expenditure  of  public 
funds,  regardless  of  necessity,  with  the  open  intent  to  despoil  all  who  have 
money,  in  the  expectation  that  they  will  get  some  of  it:  but  T  do  not  in  the 
text  refer  to  them. 


196  THE   FAKMER  AS   A   BUSINESS   MAN. 

circumstances  of  his  own  community,  will  see  many  ways  of 
saving  money  for  the  public.  My  object  in  this  chapter  is 
mainly  to  give  an  example  of  methods  of  study,  choosing, 
for  a  subject,  the  most  glaring  examples  of  wastefulness.  I 
will,  however,  take  up  one  more  subject,  which  especially 
appeals  to  farmers. 

Next  to  schools,  the  occasion  of  the  largest  expenditure  of 
public  money  in  rural  districts  is  that  of  roads.  In  the  dis- 
trict in  wliich  I  live  we  spend  more  upon  roads  than  upon 
schools.  It  is  doubtless  the  case  in  many  districts.  It  is  a  sub- 
ject which  especially  appeals  to  the  farmer  as  a  business  man. 

The  cost  of  moving  freight  by  rail  varies  materially  on 
different  roads — probably  from  one-half  cent  to  one  and  one- 
half  cents  per  mile,  and  averaging  somewhat  less  than  three- 
fourtlis  of  a  cent  per  ton  per  mile.*  The  average  cost  of  mov- 
ing freight  upon  the  roads  of  the  United  States,  as  they  are, 
and  one  season  with  another,  is  computed  by  the  United 
States  Department  of  Agriculture  to  be  twenty-five  cents  per 
ton  per  mile.  This  being  an  average,  actual  costs  will  usually 
be  higher  or  lower  than  that,  probably  varying  from  five  or 
six  cents  per  ton  per  mile  on  roads  where  one  horse  can  pull 
two  tons,  to  forty  or  fifty  cents  on  roads  where  it  requires  four 
horses  to  pull  one  ton.  In  1806  the  railroads  moved  the 
equivalent  of  76,207,047,298  tons  one  mile.  Some  of  this 
freight  was  moved  over  countr^^  roads  before  or  after  being 
moved  by  rail,  but  not  nearly  all  of  it.  Much  coal,  ore,  lumber, 
flour,  and  the  like,  never  passes  onto  the  country  roads.  I 
have  not  met  with  any  estimate  of  the  freight  traffic  by  country 
roads,  nor  can  I  find  data  for  making  a  computation.  Although 
the  tonnage  is  large,  the  distances  hauled  were  short,  and  tlie 
immber  of  ton  miles  was  small  compared  with  that  of  the  rail 
traffic.f     If  we  guess — for  I  am  unable  to  estimate — the  ton 

*The  average  rate  paid  by  the  public  in  18'.)(i  was  .806  cents  per  ton  per 
mile.     The  average  cost  to  the  railroads  was,  of  course,  less. 

fThe  price  paid  for  hauling  the  rail  trallic  of  18!M)  was  |7H(i,615,837. 
The  cost  of  hauling  the  same  number  of  ton  miles  over  country  roads,  at  the 
estimated  average  cost  of  twenty-five  ('(iiits  j)er  ton  ])er  mile,  would  have  been 
$19,051,761,826— an  interesting  fact,  as  showing  wliiit  railroads  have  done  for 
civilization. 


THE    FARMER    AND    THE    TAX-(  iATJIERER.  197 

miles  of  road  traffic  at  ono-tenth  the  volume  of  rail  traffic, 
which  does  not  seem  to  me  absurd,  the  cost  of  moving  it,  at 
twent^'-five  cents  per  ton,  was  11,905,176,182.  If  we  guess  it 
at  one-twentieth,  the  cost  was  $952,588,091,  which  seems  to  me 
entirely  reasonable,  and  probably,  as  to  tonnage,  an  under- 
estimate. If,  however,  tlie  average  cost  per  ton  per  mile  could 
be  reduced,  as  it  easily  might  be  without  excessive  taxation,  to 
fifteen  cents,  the  cost  of  moving  the  country-road  traffic  would 
be  only  $571,552,854,  which  would  be  an  annual  saving  of 
$381,035,273,  or  about  the  cost  of  sustaining  the  national  gov- 
ernment. This,  of  course,  takes  no  account  of  the  increase  of 
speed  and  comfort,  with  corresponding  reduction  in  cost,  of 
transportation  of  persons  either  on  business  or  for  pleasure. 
Some  farmers  in  the  United  States  compete  directly  with 
French  farmers  in  our  home  markets,  and  can  hardly  under- 
stand how  the  Frenchman,  in  spite  of  our  protective  duties,  is 
able  to  hold  his  own  so  well.  There  are  various  reasons,  but 
one  of  them  unquestionably  is  that,  by  reason  of  good  roads, 
one  French  horse  does  the  work,  in  hauling,  of  at  least  two 
American  horses. 

While  such  illustrations  as  these  are  commonly  employed, 
and  are  very  striking,  they  are  probably  exaggerated.  There 
are  not  many  whose  main  business  is  farming,  who  are  com- 
pelled to  keep  extra  horses  to  haul  their  produce  to  market. 
The  teams  which  are  necessarily  kept,  can  usually  do  the 
work;  but  still  the  saving  is  great;  the  driver's  time  is  saved; 
the  wear  and  tear  of  animals  and  wagons  is  reduced ;  in  some 
industries — as  sugar-beet  growing,  for  example — wdien  deliv- 
eries of  bulky  produce  have  to  be  rapidly  made  in  seasons  of 
bad  roads,  the  importance  of  a  good  road  bed  can  hardly  be 
overestimated.  My  object,  however,  is  not  to  present  an  argu- 
ment for  "good  roads."  It  is  not  now  needed  in  America. 
There  is  even  danger,  in  some  districts,  of  overexpendi- 
ture,  under  the  stimulus  of  excitement  created  by  enthusiasts. 
What  seems  to  me  likely  to  be  useful  in  this  place,  is  a  brief 
study  of  the  problem  as  a  business  man  would  view  it.  If  my 
method  of  study  commends  itself  to  the  reader,  he  can  apply 
similar  reasoning  to  the  circumstances  of  his  own  case,  and 


198  THE    FARMER    AS    A    BUSINESS    MAN. 

decide  for  himself  as  to  his  deahngs  with  tlie  tax-gatherer  in 
this  matter,  so  far  as  he  can  control  them. 

I  live  on  a  farm,  of  which  I  cultivate  about  thirty  acres. 
I  am  four  miles  from  a  railroad  station,  and  the  road  is  a 
mountain  grade,  rising,  upon  the  average,  something  over 
three  hundred  feet  to  the  mile.  As  near  as  I  can  estimate,  the 
hauling  in  connection  with  my  farm  is  equivalent  to  some- 
thing like  fifty  tons  per  annum,  hauled  between  the  farm  and 
the  station,  of  which  something  less  than  two-thirds  will  be 
down-hill.  That  is  equivalent  to  two  hundred  tons  hauled  one 
mile.  When  I  hire  hauliug  done,  I  pay  $1.00  per  ton  from  my 
house  to  the  station,  and  $2.50  per  ton  from  the  station  to  my 
house.  This  is  equivalent  to  twenty-five  cents  and  sixty-three 
cents  per  ton  per  mile,  respectively,  or  an  average  of  about 
thirty-seven  cents  per  ton  per  mile.  Two  hundred  ton  miles, 
at  thirty-seven  cents,  makes  $74  per  year  which  my  hauling 
would  cost  me,  provided  that  I  could  always  take  full  loads. 
This,  however,  I  can  not  do.  Farming  on  a  small  scale,  my 
team  must  make  many  journeys  half  loaded,  or  less.  It  is  also 
seldom  possible  to  load  both  ways,  which  would  make  a  differ- 
ence. But  I  go  to  the  city  every  week,  and,  while  I  usually 
walk  down  the  mountain,  I  prefer  to  have  horses  take  me 
back,  so  that,  with  other  necessary  personal  travel  of  the 
family,  I  must  send  a  team  to  the  station  at  least  seventy -five 
times  a  year.  When  the  roads  are  good,  one  horse  can  make 
these  trips.  When  bad,  it  requires  two  horses.  The  road  is  a 
fairly  good  mountain  grade,  as  grades  run,  but  could  be  greatly 
improved.  If  it  were  a  level  road,  its  capacity  per  horse-power 
could  be  trebled  by  sufficient  expenditure,  but  it  is  obvious  that, 
when  two-thirds  of  the  haul  is  down-hill,  that  can  not  be  done 
on  a  mountain  road.  The  road  serves  about  thirty  families, 
many  of  whom  ship  their  produce  in  a  less  concentrated  form 
than  mine,  and  so  have  a  correspondingly  larger  tonnage. 
Most  of  my  neighbors  have  larger  acreage  in  cultivation  than 
I.  I  suppose  that  three  hundred  ton-miles  each  for  the  thirty 
families  would  be  a  fair  average,  which  would  give  a  total  of 
9,000  ton-miles,  of  which  6,000  would  be  down-hill.  This,  at 
twenty-five  cents  and  sixty-three  cents  per  ton,  would  give 


THE    FARMER    AND    THE    TAX-( ;  ATII  EREK.  199 

$3,390  as  the  total  sum  paid  for  freight  traffic  over  that  road, 
of  which  I  should  pay,  probably,  $100.  Tlie  passenger  traffic 
is  also  to  be  considered,  and  it  probably  runs,  like  that  of  rail- 
road traffic,  at  about  half  the  cost  of  the  freight  traffic,  making 
a  grand  total  of  $150  for  myself,  and  $5,085  for  the  neighbor- 
hood, as  the  present  cost  of  our  traffic  on  country  roads.  Con- 
sidering all  the  circumstances  of  our  particular  case,  including 
the  fact  that  the  influence  of  gravity  can  not  be  removed,  and 
that  little  or  no  extra  stock  is  kept  by  reason  of  road  work  for 
business,  it  is  probable  that,  by  suitable  improvement,  the  cost 
of  that  traffic  could  be  reduced  one-third.  If  it  was  on  level 
ground,  it  could  certainly  be  reduced  one-half.  The  question 
then  arises,  how  much,  as  a  purely  business  proposition,  we 
could  afford  to  pay  on  such  reduction.  Computation  would* 
show  that  I  could  afford  to  pay  $50  a  year,  and  the  neighbor- 
hood could  pay  $1,9G2,  and  our  profit  would  be  in  the  pleasure. 
The  roads  serving  this  entire  community,  liowever,  aggregate 
about  ten  miles.  Stone  roads,  at  $6,000  per  mile,  would  cost 
$60,000,  upon  which  interest,  at  six  per  cent,  would  be  $3,600, 
or  far  more  than  our  saving,  or  even  than  the  saving  to  a  com- 
munity with  the  same  traffic,  on  level  land,  of  such  a  character 
that  the  saving  might  be  one-half  Even  considering  the 
reduced  cost  of  maintenance,  and  the  increase  in  the  value  of 
property,  it  is  obvious  that  stone  roads  would  not  be  economical 
in  such  a  community  as  ours.  They  would  be  simply  a  luxury, 
to  be  indulged  in  if  we  could  afford  it. 

The  above  is  given  simply  as  an  example  of  a  method  of 
study.  Any  reader  can,  in  a  similar  manner,  analyze  the  facts 
with  which  he  is  himself  called  upon  to  deal.  The  character 
of  road  improvements  which  a  community  can  properly  under- 
take, must  always  be  determined  by  the  nature  and  the  volume 
of  the  traffic.  Increased  value  of  property  is  likely  to  follow, 
but  it  is  speculative,  and  should  not  have  much  weight.  It 
brings  increased  taxes  for  all  purposes,  which  is  right  if  pro- 
ductive value  is  also  increased,  but  usually  the  economic 
saving  will  be  measured  by  the  decrease  in  cost  of  traffic. 
The  comfort  of  good  roads  is  an  entirely  different  matter.  Its 
value  is  measured,  not  by  the  income  from  it,  but  by  wdiat  one 
can  afford  to  pay  for  it. 


200  THE    FARMER    AS    A    BUSINESS    MAN. 

The  farmers  can,  however,  if  they  will,  stop  mucli  of  the 
waste  of  road  money  now  permitted.  They  can  stop  the  farce 
of  "  working  out"  the  road  tax,  still  too  common.  In  ray  time, 
when  we  were  "warned  out,"  the  resolute,  ambitious  men 
brought  mattocks;  the  reasonably  thoroughgoing  sort  brought 
shovels,  and  the  rest  of  us  took  hoes.  The  hoes  were  always 
in  a  majority,  and  it  is  doubtless  the  case  still.  When  road 
taxes  are  paid  in  money,  a  resolute  public  opinion  can  prevent 
its  waste.  The  surest  way  to  do  this  is  to  let  the  care  of  tlie 
road  by  contract,  for  a  term  of  years,  under  specifications  care- 
fully drawn.  This  can  always  be  had,  in  rural  districts,  by 
farmers,  but  only  after  a  battle  royal  with  the  small  politicians. 

Of  course  I  do  not  propose  to  deal  with  methods  of  road 
building,  but  I  can  not  forbear  saying  one  or  two  things:  The 
first  steps  in  road  improvement  must  be  to  perfect  the  align- 
ment and  gradients,  remembering  that  the  road  is  to  be  traveled 
for  thousands  of  years.  We  at  least  owe  it  to  our  posterity  to 
put  the  roads  where  they  belong.  The  next  step  is  thorough 
drainage,  with  permanent  stone  or  tile  culverts,  and  culverts 
and  fills  in  the  place  of  small  bridges.  These  are  the  first 
steps  towards  building  stone  roads,  which  may  come  later,  on 
the  same  foundation.  When  that  is  done,  proceed  according 
to  the  wealth  of  the  community  and  the  requirements  of  the 
traffic.  A  community  which  knows  how  to  do  so  much  will 
never  fail  in  the  rest. 

Whether  or  not  it  will  pay  to  incur  debt  for  road  improve- 
ment can  be  determined  only  by  cold-blooded  calculation  on 
the  volume  of  traffic.  It  will  never  pay  to  do  it  for  any  specu- 
lative motive.  There  must  be  a  plain  saving  on  the  existing 
volume  of  traffic,  sufficient,  with  a  wide  margin  of  safety,  to 
pay  interest.  The  total  outgo  of  the  individual  citizen  must 
be  decreased  by  it,  unless  the  community  expects  to  incur  debt 
for  comfort,  what,  usually,  it  ought  not  to  do. 

The  question  of  state  aid — which  means  the  aid  of  the 
people  of  cities,  and  others  who  are  not  likely  to  travel  much 
upon  the  improved  roads — involves  various  equities  which  I 
have  not  space  to  discuss.  Wliere  the  disposition  to  extend  such 
aid  exists,  it  is  evidence  of  a  noble  public  spirit.     Disregarding 


THE    FARMER    AND    THE    TAX-dATHKRER.  201 

equities,  it  seems  to  me  that  it  would  pay  the  people  of  the 
older,  richer,  and  smaller  states,  to  encourage  the  building  of 
permanent  roads  by  state  aid.  To  a  large  extent  they  are 
doing  it.  In  the  newer,  poorer,  and  larger  states,  there  is 
more  doubt  about  it.  These  undeveloped  communities  have 
usually  very  serious  local  burdens  of  their  own. 

Possibly  the  grouping  of  subjects  in  this  chapter  may  seem 
to  some  not  altogether  logical.  Whether  it  be  or  not,  the 
chapter  contains  various  matters  which  it  seemed  necessary  to 
include  in  such  a  volume  as  this,  and  to  me  it  seemed  bast  to 
present  them  as  methods  of  economy  in  public  affairs,  to  be 
considered,  largely,  by  farmers  and  others,  in  connection  with 
the  functions  of  the  tax-gatherer. 


BOOK    FIFTH. 

The  Farmer  as  a  Cooperator.* 


CHAPTEK   I. 

THE    PRINCIPLES    OF    COOPERATION. 

IN  the  conduct  of  any  business  there  are  two  elements  whose 
combination  produces  success  or  failure;  these  are  the 
principles  upon  which  it  is  established  and  the  character 
of  those  in  charge  of  it.  A  business,  whether  great  or  small, 
must  be  founded  upon  correct  principles  or  it  can  not  endure 
the  strain  of  competition,  and  in  the  end  will  be  un])rofitable. 
An  exceptionably  capable  or  industrious  man  may  for  a  time 
sustain  a  business  against  unfavorable  conditions,  and  an 
incompetent  or  idle  management  may  ruin  a  business  how- 
ever well  planned,  but  in  the  long  run  a  business  must  be 
wisely  planned  in  order  to  endure,  and  if  thus  well  founded  it 
will  succeed  under  ordinary  management. 

In  a  general  sense  all  enterprises  are  cooperative  wherein 
more  than  one  person  is  concerned.  A  bank  is  a  cooperative 
society  for  lending  money;  a  railroad  company  is  a  coopera- 
tive society  for  building  a  railroad.  Any  business  is  coopera- 
tive wherein  many  persons  unite  for  the  attainment  of  an  end 
desirable  to  all,  but  unattainable,  or  less  readil}^  attainable,  by 
any  of  them  singly.  The  ideas  and  conduct  of  such  enter- 
prises as  are  mentioned  above,  are  fully  competitive,  and 
involve  the  profit  of  the  few  at  the  expense  of  the  many. 

It  is  desirable  that  the  public  acquire  clearer  ideas  than  are 

*See  Appendix  F  for  documents  rolating  to  corporation, 
(202) 


THE    PRINCIPLES    OF    COOPERATION.  203 

now  prevalent  as  to  the  real  meaning  of  cooperation.  It  is 
already  a  great  factor  in  the  business  of  the  world  whose 
importance  is  but  dimly  recognized  by  economists,  or  states- 
men. No  census  of  this,  or,  I  think,  of  any  country,  includes 
in  its  tables  the  volume  of  cooperative  business,  of  wiiich  no 
reliable  statistics  are  attainable,  but  in  California  alone  there 
are  over  eighty  cooperative  irrigating  companies,*  besides  fruit 
marketing  societies  whose  aggregate  annual  business  is  several 
millions  of  dollars.  Cooperative  business  is  increasing  yearly, 
from  natural  causes.  It  is  a  natural  development  from  exces- 
sive competition,  and  must  increase  as  competition  grows 
more  severe.  It  is  well,  therefore,  to  understand  precisely 
what  it  is. 

Cooperation  is  the  union  of  those  of  like  interests  for  the 
purpose  of  more  effectively  competing  with  those  of  adverse 
interests.  It  is  middle  ground  between  individualism,  in  which 
each  man  competes  with  all  other  men,  and  State  Socialism, 
or  "Collectivism,"  which  assumes  such  a  union  of  all  interests 
as  to  entirely  su|>press  competition.  It  recognizes  permanent 
differences  of  interest  between  classes,  and  assumes  that  these 
differences  will  be  adjusted  with  least  friction,  by  able  repre- 
sentatives of  the  different  classes,  meeting  together  in  the  light 
of  complete  information  and  under  a  sense  of  responsibility. 
Incidentally  the  weaker  in  each  class  are  helped  by  the 
stronger  of  the  same  class,  as  a  matter  of  self-interest,  regard- 
less of  sentiment,  yet  more  or  less  moved  by  sentiment. 
Socialists  favor  it  as  a  stepping-stone  to  socialism.  Cooper 
ators  regard  cooperation  as  the  final  step,  because  it  recognizes 
as  permanent,  cleavages  of  interest  which  socialism  ignores  or 
supposes  can  be  united.  The  perfect  form  of  cooperation  is 
exhibited  in  the  Trust.  Socialism  aims  to  make  the  state  the 
industrial  unit,  involving  the  competition  of  one  state  with 
another,  and  ignoring  the  conflict  of  interest  between  classes 
within  the  state.  Cooperation  makes  the  class  the  unit 
within  the  state,  and  does  not  necessarily  regard  international 


*From  statistics  gathered  by  myself,  as  Special  Agent  of  the  U.  S.  Depart- 
ment of  Agriculture,  unpublished  when  this  is  written. 


204  THE    FARMER    AS    A    COOPERATOR. 

bouudaries.     A  distinct  term  is  needed  for  this  phase  of  cooper- 
ative effort. 

In  these  pages,  however,  because  I  wish  only  to  cover,  in 
some  detail,  a  rather  narrow  field  in  which  I  have  had 
personal  experience,  I  shall  use  the  term  cooperation  and 
cooperative  in  tlie  more  restricted  sense  in  which  they  are 
still  used  in  common  speech,  and  which  includes  only  organ- 
ized societies  of  operatives  or  producers  to  market  their  labor 
or  their  product,  or  of  any  class  of  individuals  to  purchase 
supplies.  In  this  class  of  societies  the  fundamental  idea  is 
that  of  saving  rather  than  of  gain  ;  of  keeping  what  is  already 
in  possession,  rather  than  of  securing  additional  income  or 
increase  of  capital.  Of  course  the  result,  if  success  follows,  is 
an  increase  of  net  income  which  may  be  expended  or  become 
capital.  These  enterprises  also  exclude  the  idea  of  individual 
profit  to  any  one  connected  with  the  management.* 

It  is  true  that  cooperative  enterprises  in  the  above  sense 
are  sometimes  established  with  the  same  idea  of  profit  that 
obtains  in  other  business ;  as  a  cooperative  shoe  factory,  or  a 
cooperative  cannery,  but  it  is  probable  that  when  such  con- 
cerns are  set  up  it  is  with  the  expectation  of  securing  a  higher 
price,  or  a  more  certain  market,  for  some  commodity  produced 
by  the  founders,  as  tlie  labor  in  the  case  of  the  shoe  factory, 
or  the  fruit  in  the  case  of  the  cannery,  and  the  tendency  is  to 
consume  what  would  be  profit  in  an  ordinary  business  in 
higher  wages,  or  higher  prices. 

In  referring  to  the  probable  success  or  failure  of  a  business 
enterprise,  normal  or  ordinary  conditions  are  supposed  to 
exist.  A  flood,  a  fire,  a  robbery,  or  some  general  calamity 
may  bring  the  best  planned  and  best  conducted  enterprise  to 
ruin.  These  are  the  chances  of  life  to  which  all  enterprises 
are  subject. 

The  more  common  forms  of  cooperative  enterprise  are 
societies  for  the  purchase  of  suj)i)lies  needed,  or  the  sale  of 
products  produced  by  their  members.     Societies  for  the  pur- 

*  While  a  bank  is  a  cooperative  money-lending  concern,  certain  individuals, 
by  engaging  a  certain  amount  of  their  own  capital,  and  assuming  the  manage- 
ment, expect  to  profit  by  lending  the  money  of  their  depositors. 


THE    I'RINCIPLES    OF    COOl'KRATIOX.  205 

chase  of  supplies  on  any  considerable  scale  are  in  the  nature 
of  regular  mercantile  concerns;  the  tendency  of  these  in 
America  is  into  the  liands  of  a  few  persons,  by  the  purchase 
of  the  stock  at  less  than  cost,  or  otherwise  into  the  hands  of 
the  sheriff.  In  Great  Britain  they  are  remarkably  successful. 
The  simplest  cooperative  enterprises  are  those  for  the  sale 
of  products  of  their  members,  and  it  is  with  these  that  these 
pages  will  be  occupied,  although  of  course  the  more  general 
principles  are  applicable  to  all  forms  of  cooperation.  A 
"cooperative  store"  buys  and  sells,  but  the  fundamental  idea  is 
buying  cheaply  and  saving  by  its  members.  The  fundamental 
idea  of  marketing  societies  is  the  highest  attainable  prices  for 
products.  These  ideas  are  contradictory,  but  both  forms  are 
included  in  the  term  "distributive  cooperation." 

All  business  is  a  science  whose  laws  must  be  obeyed  or 
failure  will  result.  It  is  not  abstruse;  on  the  contrary  it  is 
the  simplest  of  sciences.  It  is  a  science  best  learned  in  the 
school  of  experience,  and  all  who  succeed  in  business  have 
mastered  its  principles  so  far  as  they  apply  to  the  business 
which  occupies  them.  They  may  never  have,  and  most  likely 
have  not,  seen  or  heard  of  any  book  relating  to  the  principles 
of  business,  but  if  they  pick  up  such  a  book  in  which  the 
underlying  principles  of  business  are  set  down  in  an  orderly 
way,  they  find  little  or  nothing  with  which  they  are  not 
perfectly  familiar  and  are  surprised  that  it  should  have  been 
thought  worth  while  to  write  and  print  such  simple  things. 
And  yet  it  is  true  that  the  majority  of  business  enterprises 
fail  because  these  principles  are  not  followed.  Of  course  it  is 
also  true  that  many  fail  in  business  who  understand  its  prin- 
ciples well  enough,  but  have  not  the  vigor  and  will  power  to 
always  follow  them. 

The  fundamental  principles  of  business  a{)ply  to  the  con- 
duct of  a  farm,  of  course,  as  well  as  to  pure  trading,  but  their 
application  to  trade  involves  the  knowledge  of  a  good  many 
facts  and  the  perception  of  many  relations  which  do  not 
usually  come  within  the  experience  of  farmers  or  workingmen. 
If,  therefore,  farmers,  through  cooperation,  engage  in  trade, 
they  must,  if  they  expect  success,  become  familiar  with  these 


206  THE    FARMER    AS    A    COOPERATOR. 

tliin^-s  through  other  sources  than  their  own  experience. 
Tliey  must  obtain  and  profit  by  the  experience  of  others. 
The  object  of  these  cliapters  is  to  set  forth  the  most  important 
ihings  to  be  considered  in  establisliing  cooperative  enterprises 
:iii(l  the  most  convenient  methods  of  procedure  both  in 
t'stablishing  and  conducting  them. 

Those  characteristics  of  a  person  which  are  peculiar  to 
himself  as  distinguished  from  the  qualities  and  nature  of 
mankind  of  his  country  and  race  are  called  his  "j)ersonal 
equation."  As  these  personal  characteristics  must  be  con- 
stantly taken  into  account  in  considering  the  probabilities  of 
success  or  failure  in  business,  it  wnll  be  convenient  as  occasion 
arises  to  use  this  term  for  them. 

The  establishment  of  a  cooperative  enterprise  is,  in  one 
respect,  more  complex  than  the  founding  of  a  personal  busi- 
ness, in  that  its  constitution  must  be  sucli  as  to  insure  the  best 
ability  available,  and  perfect  honesty  for  the  conduct  of  its 
affairs.  In  a  private  business,  the  personal  equation  is  fixed. 
What  a  man  is,  he  is,  and  he  is  inseparably  attached  to  his 
business.  In  a  cooperative  business  the  directors  change,  but. 
in  the  main,  will  usually  represent  the  best  available  e.Kperi- 
ence  and  ability  of  the  membership;  their  election  proves  that, 
in  the  judgment  of  their  fellows,  they  are  tlie  proper  persons 
to  direct  the  common  affairs,  and  we  can  not  go  beyond  that. 
But  the  active  executive  management,  to  be  efficient,  must  be 
in  the  handaof  one  person,  whose  personal  equation  will  have 
much  to  do  with  the  prosperity  of  the  concern,  and  there  are 
natural  laws  which,  if  enacted  into  rules  by  the  main  body  of 
the  society,  and  carefully  obeyed,  will  almost  certainly  insure 
honesty  in  this  important  position,  and  sufficient  competence 
for  its  duties. 

It  has  been  said  that  the  fundamental  and  natural  laws  of 
business  will  apply  to  the  conduct  of  the  farm  and  the  workshop, 
but  it  is  also  true  tliat  business  is  the  subject  of  municipal  or 
statute  law  as  well,  and  that  statute  law  deals  with  traders  in 
some  respects  otherwise  than  with  farmers  or  workmen;  and, 
in  many  cases,  it  has  to  deal  with  transactions  which  would 
not  occur  in  a  strictly  farming  business.     Cooperative  trading 


THE    rRINCIPLP:S    OF    COOPERATION.  207 

is  subject  to  the  same  law  as  private  trading,  and  it  is 
important  tliat  the  members  of  cooperative  societies  shall 
have  at  least  such  general  knowledge  of  their  legal  rela- 
tions and  responsibilities  as  will  prevent  them  from  involving 
themselves  more  than  they  intend.  This  is  not  a  law  book, 
and  it  will  give  no  advice  or  caution  beyond  such  teachings 
of  plain  common  sense  as  a  layman  may  properly  attempt,  but 
business  is  business,  and,  if  not  done  properly,  may  lead  to 
trouble,  and  when  it  does,  it  is  invariably  the  ignorant  or 
incautious  who  suffer.  There  are  some  things  which  it  is 
safest  not  to  do,  and  it  will  be  proper  to  point  these  out. 

The  only  way  in  which  cooperative  business  on  any  consid 
erablo  scale  can  be  safely  and  effectively  carried  on  is  by  the 
means  of  a  corporation.  Now  a  corporation  is  wholly  a  crea- 
ture of  statute  law,  and  must  be  founded  and  governed  strictly 
in  accordance  with  the  mandates  of  law.  Thcso  are  not  intri- 
cate or  hard  to  ascertain;  on  the  contrary,  tlioy  are  simple 
and  within  the  understanding  of  all,  and,  if  carefully  fol- 
lowed, enable  cooperative  business  to  be  transacted  readily 
and  safely. 

It  seems  to  me  probable  that  cooperative  business  will 
gradually  become  an  important  and  permanent  feature  of  our 
social  fabric.  This  opinion  is  based  upon  the  belief  that 
extreme  social  pressure  will  always  find  ti)e  most  ready  relief 
in  cooperation.  Even  farmers  will  combine  rather  than  reduce 
their  standard  of  comfort.  The  well-known  saying  in  regard  to 
railroads,  that  "where  combination  is  possible,  competition  is 
impossible,"  is  based  upon  the  experience  that  between  points 
furnishing  a  good  business,  more  railroads  will  be  built  than 
are  required  to  do  the  business,  and  that  competition  will 
ensue  until  bankruptcy  threatens  one  or  both,  when  combi- 
nation in  some  form  will  follow.  In  competitive  society  there 
is  the  same  tendency  in  all  business,  except  that  the  great 
number  of  individuals  concerned  makes  combination  very 
difficult.  The  natural  man  desires  above  all  things  to  do 
what  he  pleases;  so  long  as  he  can  do  that,  and  be  reasonably 
prosperous,  he  will  make  no  agreement  whereby  he  foregoes 
any  part  of  his  liberty  of  action.    A  few  seasons  of  real  trouble, 


208  THE    FARMER    AS    A    COOPERATOR. 

however,  make  him  ready  to  unite  with  others  in  the  same 
occupation  for  mutual  relief.  But  successful  cooperation  is  a 
sure  sign  of  trouble  in  the  industry  involved. 

It  does  not  necessarily  follow,  however,  that  returning 
prosperity  will  break  up  cooperative  business.  It  may,  or  it 
may  not.  Business  is  sure  to  seek  the  easiest  channels.  The 
pressure  of  circumstances  may  cause  a  change  from  competi- 
tive to  cooperative  methods,  and  then,  certain  habits  having 
been  acquired,  and  certain  investments  made,  business  may 
more  easily  flow  in  the  new  channels  than  return  to  the  old. 
It  depends  on  the  wisdom  with  which  the  cooperative  enterprise 
has  been  planned. 


CHAPTHR    11 

CEETAIN    FUXDAMENTAL    KULE8    OF    COOPERATION. 

IT  has  been  said  that  cooperative  business  is  subject  to  the 
same  natural  and  municipal  law  as  other  business,  and 
that  this  is  not  a  treatise  intended  to  cover  that  subject; 
but  tiiere  are  certain  of  these  laws  which  are  absolutely  fun- 
damental, and  yet,  as  experience  shows,  quite  likely  to  be 
overlooked  in  cooperative  enterprises,  and  which  it  is  therefore 
desirable  to  consider  here. 

Cooperative  business  requires  an  adequate  capital.  One 
would  suppose  this  truism  to  be  universally  recognized,  but  it 
is  not;  or  possibly  it  would  be  more  correct  to  say  that  proper 
estimates  of  the  capital  necessary  to  cooperative  enterprises  are 
often  not  made  in  advance.  A  sum  is  assumed  to  be  sufficient 
which  is  not  sufficient.  This  is  the  result  of  ignorance.  The 
promoters  of  cooperative  enterprise  among  farmers  are  usually 
those  who  have  not  had  mercantile  experience,  and  who  do 
not,  therefore,  foresee  all  the  occasions  of  outlay,  or  the  disas- 
trous consequence  of  being  without  means  to  meet  them.  The 
result  of  inadequate  capital  is  debt  with  no  means  of  payment, 
and  the  end  is  often  failure.  Of  course  this  does  not  always 
happen;  new  efforts  may  be  made,  and  the  debt  wiped  out. 
A  cooperative  business  once  started,  and  some  money  expended 
upon  it,  can  hardly  be  permitted  to  drop  without  trial;  the 
work  begins,  unforeseen  and  pressing  necessities  for  expendi- 
ture arise,  and  debt,  more  or  less  serious,  is  incurred;  in  any 
business  it  is  seldom  possible,  during  the  first  year,  to  pay  debt 
from  income;  if  the  management  is  sufficiently  wise  and  vig- 
orous to  promptly  appeal  to  the  stockholders  for  additional 
capital,  the  moment  the  necessity  for  debt  appears,  all  may  go 
well;  but  even  in  that  case,  confidence  is  impaired;  the  man- 
agement begins  to  be  distrusted ;  new  members  are  afraid  to 
join,  and  old  members  are  disposed  to  drop  off.     But  it  .'seldom 

(209) 

14 


210  THE    FARMER    AlS    A    COorKRATOR. 

happens  that  a  management  which  has  been  unwise  cnougli 
to  accept  duties  for  whose  execution  sufficient  funds  have  not 
been  provided,  will  have  thereafter  the  wisdom  and  courage  to 
promptly  meet  financial  difficulty  in  a  business-like  way.  The 
beginnings  of  cooperation  are  very  apt  to  be  among  the  least- 
prosperous  classes,  some  part,  at  least,  of  whose  misfortunes  may 
always  be  attributed  to  their  own  lack  of  foresight  and  vigor. 
These  qualities,  carried  into  the  management  of  cooperative 
affairs,  are  quite  apt  to  lead,  in  emergencies,  to  the  creation  of 
debt,  with  the  vague  idea  that  payment  can  be  made  "some- 
how," when  the  time  comes. 

In  this  I  am  speaking  rather  from  my  own  observation  of 
societies  organized  for  the  sale  of  products  produced  by  their 
members  than  of  those  formed  for  regular  mercantile  enter- 
prises where  goods  are  bought  as  well  as  sold.  In  the  latter 
case  all  would  recognize  the  need  of  capital,  and  so  long  as 
purchases  and  sales  were  made  entirely  for  cash,  there  could 
hardly  be  failure,  although  there  might  not  be  prosperity. 
But  the  success  of  such  concerns  depends  so  entirely  on  the 
personal  equation  of  the  manager  and  membership  that  I 
regard  them  as  unsafe.  A  few  of  them  have  been  successful  in 
this  country  and  many  notable  successes  have  been  achieved 
in  Europe.  In  this  country,  how^ever,  where  success  has  been 
attained,  it  appears  to  have  been  mostly  owing  to  the  personal 
qualities  of  the  managers.  There  is,  perhaps,  more  stabil- 
ity of  character  among  the  masses  of  England.  I  can  not 
otherwise  account  for  the  great  success  of  cooperative  mer- 
cantile enterprises  there. 

There  is  no  sentiment  in  cooperation.  So  far  as  a  cooper- 
ative movement  is  based  on  sentiment,  it  is  likely  to  fail;  and 
it  ouglit  to  do  so.*  If  the  results  of  cooperation  are  to  increase 
the  incomes  of  the  cooperators  the  facts  will  appear  in  due 
time,  and  cooperative  enterprises  will  multiply;  if  the  results 
do  not  increase  individual  incomes,  such  societies  will  properly 
disappear.    It  is  a  question  of  individual  advantage  rather  than 


*  For  further  discussion  of  tliis  aspect  of  cooperation,  see  Chapter  VIII  of 
this  book  and  Appendix  F. 


FUNDAMENTAL    RUI>KS    OF    COOPERATION.  211 

of  public  duty,  and  should  be  treated  as  such.  There  is  doubt- 
less at  the  beginning  of  important  cooperative  enterprises  a  ne- 
cessity for  the  useful  exercise  of  public  spirit,  during  a  short 
time,  in  educating  the  masses  in  the  aims  and  methods  of 
cooperation.  The  British  cooperative  societies  maintain  such 
a  propaganda  permanently,  relying  upon  it  as  a  principal 
means  of  extending  their  business.*  Bat  in  America,  at  least, 
popular  enthusiasm  is  entirely  unreliable  as  the  basis  of  busi- 
ness enterprises,  and  any  action  taken  should  be  based  on 
cold  business  calculations.  Cooperative  enterprises  must  be 
projected  in  the  light  of  human  nature  as  it  is,  and  not  as  we 
may  wish  it  might  be,  or  hope  it  may  become.  Social  evolu- 
tion may  sometime  produce  a  race  which  is  unselfish,  and 
broad-minded;  but  it  has  not  yet  done  so,  and  if  its  operation 
tends  that  way  its  movement  is  too  slow  to  permit  the  present 
or  the  next  generation  to  seriously  consider  it  in  founding 
business  enterprises.  It  is  generally  believed  that  cooperative 
societies  for  marketing  products  tend  to  equalize  receipts 
among  growers,  and  to  prevent  undue  depression  of  prices  at 
the  point  of  production.  All  growers  will  therefore  encourage 
their  formation  by  others,  but  great  numbers  will  seek  to 
avoid  any  risk,  expense,  or  obligation  connected  with  them, 
fully  intending  to  make  use  of  them  if  made  successful  at 
others'  risk,  and  to  compete  with  them  b}'  slightly  underselling 
if  they  feel  so  disposed. 

Of  course  this  is  utterly  contemptible,  but  it  is  so  general 
that  it  must  be  considered  characteristic  of  human  nature.  It 
must  be  taken  into  account  iu  founding  cooperative  societies, 
as  the  experience  of  dealing  with  this  class  may  be  certainly 
expected.  It  is  therefore  necessary  to  make  sure  that  there 
are  enough  members  who  believe  it  will  pay  them  best  to 
support  and  carry  through  the  undertaking.  There  are,  of 
course,  those  who  once  having  entered  upon  such  an  enter- 
prise, will  stand  by  it  as  a  matter  of  good  faitli,  whatever  temp- 


*  Some  of  the  best  English  tracts  place  the  public  welfare  as  atlected  bv  the 
iifluence  of  cooperation  upon  membership  before  the  material  advantao-e  to  the 
members.     See  Appendix  F. 


212  THE  FARMER  AS  A  (OOPERATOR 

tations  may  be  offered  them  to  leave  it;  but  there  are  too  few 
of  these  to  be  considered. 

Business,  in  the  end,  will  certainly  flow  to  the  easiest  chan- 
nels; if  cooperative  enterprises  succeed,  it  must  be  because 
exj)erience  shows  individuals  that  it  is  not  only  more  profit- 
able, but  unusually  more  convenient,  to  deal  through  them 
than  elsewhere.  Men  will  not  long  subject  themselves  to  per- 
sonal inconvenience  to  promote  any  enterprise  even  though 
they  really  believe  it  to  be  almost  essential  to  the  general 
prosperity.  They  will  almost  universally  rely  uj)on  its  receiv- 
ing the  necessary  support  from  others,  and  not  concern  them- 
selves personally.  It  is,  therefore,  of  the  utmost  importance 
that  cooperative  enterprises  shall  be  well  plamied,  properl}^ 
located,  and  equipped  to  do  in  the  most  economical  and  eflect- 
ive  manner  whatever  they  propose  to  do  at  all.  There  is 
really  no  difficulty  in  this,  nor  need  there  be  any  lack  of 
money.  While  the  general  complaint  of  producers  is  lack  of 
capital,  yet  it  must  never  be  forgotten  that  the  aggregate 
capital  invested  in  producing  any  given  quantity  of  material 
is  very  far  in  excess  of  the  sums  required  to  market  it.  The 
advantage  over  farmers  which  outside  capital  possesses  is  in  its 
form — money — its  concentration,  and  power  of  repeated  use 
within  a  short  time.  Whenever  farmers  once  combine  in  a 
firm  and  legal  manner,  their  financial  strength  is  enormously 
greater  than  that  of  the  mercantile  concerns  which,  in  the 
absence  of  coo[)eration,  would  handle  and  market  their  crops. 

It  is  tliis  fact  which  makes  successful  cooperation  possible. 
It  is  a  maxim  never  to  be  forgotten  that  those  who  supply  the 
capital  will  control  the  business;  and  it  usually  does  not  much 
matter  whether  the  funds  are  invested  as  profit-sharing  capital 
or  as  loans;  in  the  latter  case  capital  is  almost  certain  to  so 
protect  itself  as  to  practically  control,  so  far  as  it  desires  to  do 
so.  If  3^ou  borrow  mt)ney  on  produce,  for  example,  the  control 
of  sale  nominally  remains  in  your  hands,  and  may  actually  so 
remain  so  long  as  the  margin  of  security  is  abundant,  and  the 
lender  has  no  more  profitable  use  for  his  money;  but  if  he 
needs  his  money,  or  if  for  any  reason  he  becomes  dissatisfied 
with  your  management,  you  will  find  that  within  a  short  time 


FU\I)A.\fKN'TAL    RULES    OF    COOPKRATION.  213 

you  will  be  compelled  to  sell  regardless  of  the  market.  Money 
is  bound  to  control.  It  is  therefore  of  the  utmost  importance 
that  when  loans  have  to  be  made,  as  will  ordinarily  be  the 
case  by  marketing  associations  during  the  crop  moving  period, 
they  should  not  be  accepted  from  any  person  or  firm  having 
any  possible  interest  adverse  to  that  of  the  association,  or 
whom  the  association  may  wish  to  control  or  direct.  When 
you  have  borrowed  money  of  a  man,  he  controls  you,  not  you 
him;  under  no  circumstances,  therefore,  should  advances  be 
accepted  from  commission  firms.  The  pro})er  source  from 
which  to  obtain  necessary  loans  is  the  local  bankers  whose 
prosperity  is  always  in  a  direct  ratio  with  that  of  the  com- 
munity in  which  they  do  business,  and  who,  in  spite  of  much 
po})ular  prejudice  against  them,  may  almost  invariably  be 
relied  upon  to  supply,  so  far  as  })rudence  will  permit,  all  funds 
legitimately  required  for  temporary  use.  They  are  nearly 
always  the  ablest  and  most  disinterested  advisers  in  financial 
affairs,  that  a  cooperative  society  can  have.  It  is  distinctly  to 
their  interest  that  all  legitimate  business  enterprises  in  their 
community  shall  prosper. 

No  man  can  successfully  prosecute  a  business  which  he 
does  not  himself  understand.  The  owners  of  a  business  are 
those  who  put  money  into  it.  Whoever  puts  money  into  a 
business  which  he  does  not  understand  is  almost  certain  to 
lose  it.*  There  are  no  business  maxims  more  important  to 
cooperators  than  these.  They  supply  the  standard  wliereby 
those  cooperative  enterprises  which  are  safe  can  be  distin- 
guished in  advance  from  those  whicli  are  dangerous. 

The  topic  requires  some  elaboration.  In  a  cooperative 
society  the  average  of  the  personal  equations  of  its  members 
will  represent  a  certain  degree  of  ability  and  exporience,  which 
will  be  quite  accurately  reflected  in  the  Board  of  Directors, 
and  which  changes  very  little  from  year  to  year.  If  the  society 
is  organized  to  transact,  on  a  large  scale,  business  which  each 


*  That  the  small  investors  in  British  Cooperative  Societies  do  not  lose  their 
money  is  due  to  the  fact  that  in  Great  Britain  the  cooperative  movement  has 
developed  some  wonderful  men, — I  might  say  a  wonderful  race  of  men.  We 
have  not,  in  America,  yet  developed  cooperators  with  business  capacity  of  first- 
rate  caliber  who  will  practically  donate  their  services  to  their  fellow-men. 


214  THE    FARMER    AS    A    COOPERATOR. 

member  is  accustomed  to  transact  for  himself  on  a  smaller 
scale,  there  need  be  no  apprehension  of  lack  of  ability  to 
manage  the  business  well,  and  with  ordinary  prudence  in 
providing  capital  and  keeping  out  of  debt,  there  is  no  reason 
not  to  expect  success.  For  example,  in  a  dairying  community 
there  is  general  information  as  to  the  processes  and  general 
expense  of  butter  or  cheese  making,  and  a  cooperative  cream- 
ery may  be  expected  to  succeed;  so  in  a  fruit-drying  commu- 
nity, whose  members  are  accustomed  to  dry  fruit  extensively 
on  their  farms,  there  is  no  difficulty  in  maintaining  successful 
fruit-drying  associations.  Sucli  societies  are  also  able  to 
successfully  take  a  step  in  advance,  provided  the  step  be  not 
too  great.  For  example,  the  fruit-growers  of  California  are 
accustomed  to  sell  their  dried  fruit  each  year  to  local  buyers, 
who  concentrate  it  in  warehouses  and  sell  it  in  distant  markets. 
It  has  been  found  entirely  practicable  and  economical  for 
growers  to  bring  their  own  fruit  to  their  own  cooperative 
warehouses,  and  have  it  sold  for  themselves  in  the  distant 
markets,  by  their  own  officers.  In  this  case  there  is  the  simple 
advance  from  a  retail  business  of  a  few  tons  each,  to  a  whole- 
sale business  dealing  only  in  car-load  lots,  and  collecting 
through  the  banks  in  the  ordinary  mercantile  way,  instead  of 
receiving  cash  on  their  farms  from  the  local  buyers.  There 
has  been  no  trouble  whatever,  but  no  one  would  expect  a 
dairy  association  to  manipulate  or  sell  dried  fruit  successfully; 
nor  could  any  association  of  fanners  successfully  carry  on  a 
cooperative  shoe  factory,  although  a  body  of  shoe-making 
operatives  might  do  so.  These  distinctions  are  obvious,  but 
often  they  are  less  so,  and  producers  induced  to  invest  money 
in  a  business  too  complicated  for  them;  for  example,  while 
any  farmers'  society  can  dry  and  sell  fruit  successfully,  it  can 
seldom,  if  ever,  make  a  success  of  a  coo[)erative  cannery,  which 
is  a  complicated  manufacturing  business  in  which  several 
times  as  much  money  has  to  be  paid  for  sugar,  labor,  and 
packing  materials  as  for  the  fruit.  It  has  not  been  found  safe 
to  permit  salaried  employees,  themselves  mostly  without  expe- 
rience, to  expend  three  or  four  thousand  dollars  of  money, 
usually  borrowed,  in  the  purchase  of  material  and  labor  to 


^"UXDAMESTAL    RULES    OF    COOPERATION.  215 

put  with  $1,000  worth  of  fruit  owned  by  the  cooperators.  The 
finished  product  has  usually  sold  for  less  than  the  aggregate 
cost,  and  as  canning  operations  very  rapidly  run  into  money, 
the  losses  have  often  been  such  as  to  involve  heavy  assessments 
on  tlie  stocklioldcrs  to  make  them  good.  It  is  not  safe  for  any 
cooperative  society  to  attempt  such  things.  They  may  succeed, 
but  when  they  do,  it  is  because  one  or  more  public-spirited 
y)ersons  give  to  the  community  the  benefit  of  their  talent  and 
industry  which  they  might  have  used  to  build  up  their  own 
fortunes. 

Cooperative  societies  must  do  a  strictly  cash  business.  Any 
serious  departure  from  this  is  nearly  certain  to  involve  dis- 
aster. If  there  is  no  money  in  a  community,  or  among  those 
who  wish  to  cooperate,  it  is  best  not  to  try  to  do  business.  If 
there  is  little  money,  keep  down  the  scope  of  the  enterprise 
to  suit  the  amount  of  capital.  By  retaining  all  the  profits  in 
the  business,  as  additions  to  capital,  the  business  can  soon  be 
extended. 

This  is  a  very  important  point.  Few  understand  the  accu- 
mulating power  of  capital  judiciously  managed.  Suppose  one 
hundred  persons,  having  $10  each,  start  a  cooperative  store, 
undertaking  to  buy  only  for  cash.  Such  an  enterprise  could 
not  possibly  succeed  if  ordinary  rents  and  mercantile  salaries 
were  paid,  because  the  expense  would  exceed  any  possible 
profit  on  sta})le  goods  to  that  amount.  If  any  show  whatever 
is  made,  or  attempt  to  attract  trade  by  advertising  or  display, 
the  capital  is  almost  certain  to  disappear.  But  if  the  owners 
will  not  despise  the  day  of  small  things,  and  will  be  content 
for  a  time  to  go  to  some  out  of  the  way  place,  involving  little 
or  no  rent,  and  undertake  to  make  their  purchases  of  evenings, 
it  is  possible  for  great  results  to  follow;  by  restricting  the 
commodities  dealt  in  to  a  few  staple  articles,  it  would  be  quite 
possible  to  turn  over  such  a  capital  once  a  month,  at  an  aver- 
age net  profit  of  five  per  cent;  a  hundred  families  loyally  sup- 
porting their  own  business,  would  certainly  purchase  goods  to 
the  value  of  $1,000  per  month.  This,  at  the  end  of  the  first 
year,  would  give  a  capital  of  $1,500;  at  the  end  of  the  second 
year,  $2,250;  at  the  end  of  the  third  year,  $3,375;  of  course,  as 


216  THE    FARMER    AS    A    COOPER ATOR. 

capital  grows  larger,  it  can  not  be  "  turned  "  so  often,  and  after  a 
time  expenses  would  increase,  as  tlie  manager  would  tire  of 
working  for  next  to  nothing,  and  no  one  would  expect  it;  but 
that  is  the  secret  of  a  successful  cooperative  store:  buying  and 
selling  for  cash,  and  keeping  the  profits  in  the  business,  until 
the  capital  is  sufficient,  when  cash  dividends  can  be  paid. 
Our  uneas}^  and  show-loving  populations  are  not  likely  to  be 
willing  to  practice  this  self-denial;  successful  managers  want 
more  and  more  of  the  profits,  because  they  too  are  easily 
affected  with  the  notion  of  keeping  up  a  certain  "])osition." 
It  seems  to  be  this  national  characteristic  which  has  usually 
rendered  cooperative  mercantile  enterprises  unprofitable  in 
America.  The  reason  of  this  is  very  obvious.  It  would  prob- 
ably be  easy  in  any  community  to  find  a  shrewd,  hard-headed 
workman  or  farmer,  who  could  lay  out  $1,000  in  staple  mer- 
chandise wisely;  but  if  he  were  called  to  invest  $30,000  in  the 
same  way  he  would  be  all  at  sea.  Sharp  salesmen  would  be 
almost  sure  to  load  him  up  with  unprofitable  stock.  It  is  a 
very  puzzling  thing  for  a  new  man  to  lay  in  a  stock  of  mer- 
chandise. He  must  have  the  ability  to  say  "No"  to  very 
persuasive  men,  pretty  much  all  day  long.  But  as  the  busi- 
ness increases  it  becomes  easier  both  to  determine  what  you 
should  buy,  and  to  refuse  what  you  do  not  wish.  The 
manager's  ability  grows  with  his  business,  so  that  there  is 
much  more  hope  of  an  enterprise  starting  with  a  very  small 
capital  than  of  any  other.  But  cooperative  "stores"  have 
proved  very  hazardous  things  in  America. 

Cooperative  and  individual  business  enterprises  are  subject 
to  the  same  statute  laws  governing  "trade,"  which  are  in  some 
respects  diff'erent  from  the  laws  affecting  transactions  between 
persons  not  in  trade.  If  a  farmer  does  not  pay  his  note  at 
maturity,  he  is  of  course  subject  to  suit  and  judgment  and  the 
sale  of  any  property  that  can  be  reached  to  satisfy  the  judg- 
ment; a  "trader,"  however,  will  ordinarily  be  in  debt  to  many 
persons,  and  have  many  more  indebted  to  him.  In  case  he 
should  fail  to  pay  some  obligation  when  due,  the  creditor,  if 
permitted  without  restraint  to  take  the  above  course,  might 
unnecessarily  break  up  a  business  and  render  it  impossible  to 


FUNDA^rENTAL    RULKS    OF    COOPIOllATIOX.  217 

satisfy  other  claims  against  it.  Most  states,  therefore,  have 
insolvency  laws  whereby  a  trader  unable  to  pay  his  debts  at 
maturity,  may  be  compelled  to  surrender  his  property  and 
business  to  be  administered  for  the  benefit  of  all  his  creditors. 
Cooperative  societies  engaged  in  trade  would  be  subject  to 
these  laws,  and  the  object  of  this  reference  to  them  is  to 
impress  on  those  proposing  to  cooperate  the  vital  necessity  of 
maintaining  credit,  by  promptly  meeting  all  obligations  when 
due.  As  already  stated,  all  permanent  debt  is  dangerous  to 
cooperative  societies,  but  if  unfortunately  debt  be  incurred, 
provision  must  always  be  carefully  made  in  advance  for 
prompt  payment. 


CHAPTER  III. 

COOPERATIVE  CORPORATIONS. 

AS  cooperative  enterprises  will  usually  be  carried  on  by 
corporations  created  for  the  purpose,  it  seems  necessary 
to  devote  some  space  to  their  consideration.  I  can  not 
say  too  often  that  this  is  not  a  law  book,  and  that  while  there 
are  many  things  which  can  be  profitably  said  here  in  regard 
to  corporations,  whoever  proposes  to  organize  one  should  take 
no  guide  whatever  but  the  printed  law  of  his  own  state,  and 
the  advice  of  a  competent  lawyer.  As  laws  affecting  corpora- 
tions are  continually  being  changed  in  all  states,  one  must  not 
only  consult  the  law,  but  be  sure  that  it  is  the  law  as  left  by 
the  last  Legislature.  In  fact,  if  a  corporation  is  worth  organ- 
izing it  is  worth  doing  it  under  the  advice  of  an  experienced 
and  capable  lawyer. 

The  popular  use  of  tlie  term  ''corporations,"  of  late  years, 
to  denote  the  great  aggregations  of  capital  which  are  so  often 
employed  to  oppress  the  masses,  has  been  such  that  there  has 
grown  up  against  those  very  useful  institutions  a  certain 
unreasoning  prejudice  whicli  often  renders  it  very  difficult  to 
induce  people— especially  farmers— to  go  into  them.  This 
prejudice  has  been  greatly  strengthened  by  unfortunate  results 
which  have  befallen  many  who  did  go  into  them  blindly. 
Tiiere  can  be  no  business  without  risk  of  loss.  If  I  buy  a 
farm  at  current  prices,  circumstances  beyond  my  control  may 
create  conditioiTs  which  will  make  it  unsalable  at  half  what  I 
pay  for  it.  If  I  have  paid  cash,  I  have  then  lost  half  my 
investment;  if  I  have  borrowed  half  the  cost,  I  have  lost  all 
my  capital  and  must  pay  rent  in  the  form  of  interest  so  long 
as  my  creditor  permits;  when  he  chooses  he  will  take  my 
farm  to  repay  his  advance.  If  I  lend  money,  no  matter  how 
well  secured,  there  is  a  possibility  of  loss.  If  I  engage  in 
mercantile  business  there  is  still  more  chance  of  loss.  If  I 
(218) 


COOPERATIVK    ( •()T!P(  )H  ATIONS.  219 

raise  produce  it  may  be  burned  before  sale,  or  I  may  sell  it  at 
less  than  its  value.  If  I  unite  with  my  neighbors  to  do  any  of 
these  things  in  a  cooperative  way,  there  is  the  same  danger  of 
loss.  If  I  incur  debt  I  am  holden  to  the  extent  of  my  property 
for  its  payment.  If  I  duly  authorize  another  to  incur  debt  in 
my  behalf,  I  am  properly  held  as  firmly  as  if  I  had  myself 
conducted  the  transaction.  If  I  enter  a  partnership,  either  of 
the  partners  may  incur  liabilities  of  which  I  am  ignorant 
which  may  sweep  away  my  entire  property.  If  I  join  an  asso- 
ciation, however  loosely  united,  and  indebtedness  is  incurred 
in  pursuance  of  the  objects  for  which  the  association  is  founded 
— as,  for  example,  if  the  association  guarantees  the  freight  on 
a  car-load  of  fruit — I  am  responsible  not  only  for  my  share  of 
the  guarantee,  but,  if  I  am  the  only  member  able  to  respond, 
for  the  entire  amount.  It  is  a  princi})le  not  only  of  law  but 
of  equity  that  I  be  responsible  for  the  act  of  my  agent  within 
the  limit  of  his  agency,  and  the  association  is  my  agent;  and 
there  is  probably  no  limit  to  my  responsibility  except  the 
limit  of  my  property. 

A  corporation  is  a  means  provided  by  law  whereby  a  large 
number  of  persons  can  safely  and  conveniently  do  business  as 
one  person.  By  incorporation  individuals  are  enabled  to 
escape  many  inconveniences  and  liabilities  which  they  would 
incur  by  doing  business  as  a  partnership,  or  an  unincorporated 
association,  which  is  legally  the  same  as  a  partnership. 

1.  By  the  death  of  a  partner  the  whole  business  is  liable  to 
be  thrown  into  court,  with  varying  possibilities,  according  to 
circumstances,  of  hindrances  in  transacting  its  business,  or  a 
possible  enforced  winding  up  of  its  affairs.  The  death  of  a 
stockholder  in  a  corporation  need  make  no  difference  in  the 
conduct  of  its  business. 

2.  In  an  ordinary  partnershi[),  any  of  the  })artners  may 
create  liabilities  involving  the  property  of  all  the  partners;  in 
a  corporation  the  law  provides  means  whereby  the  power  to 
incur  debt  is  restricted  to  certain  persons  named  by  the  stock- 
holders, and  who  may  be  restrained  by  by-laws,  ojid  caused  to 
give  bonds  not  to  violate  them. 

3.  Instead  of  each  stockholder  being  liable,  like  a  partner, 


220  THE    FARMER    AS    A    COOPERATOR. 

to  the  extent  of  liis  property,  for  the  entire  indebtedness  of 
the  concern,  he  is  liable  only  for  a  certain  definite  amount, 
which  is  fixed  by  statute  in  each  state:  in  California  he  is 
liable  for  such  a  ratio  of  the  indebtedness  as  the  stock  owned 
by  him  is  of  the  total  stock  issued;  if  he  owns  one-tenth  of 
the  stock,  he  is  liable  for  one-tenth  of  the  indebtedness,  and 
no  more.  Each  state  has  its  own  law  upon  this  matter.  Some 
states  may  permit  so-called  "limited"  corporations,*  in  which 
stockholders  in  corporations  are  liable  only  to  the  amount  of 
their  stock  subscription;  when  their  stock  is  fully  paid  up 
there  can  be  no  further  call  upon  them,  no  matter  what 
indebtedness  is  incurred. 

Corporations,  therefore,  are  not  only  more  convenient,  but 
far  safer  than  partnerships  or  associations,  when  any  consid- 
erable number  of  persons  unite  to  establish  a  permanent 
business. 

Among  farmers  who  become  stockholders  in  cooperative 
enterprises  there  is  a  very  common  source  of  complaint,  which 
has  no  foundation  in  reason,  and  that  is  "assessments"  on 
stock  not  fully  paid  up;  if  I  subscribe  for  ten  shares  of  stock 
at  $10  a  share,  I  obligate  myself  to  pay  $100  at  such  times  and 
under  such  conditions  as  the  by-laws  of  the  corporation  and 
the  laws  of  the  state  prescribe ;  and  having  thus  promised  I 
have  no  right  to  complain  that  I  am  held  to  the  promise. 
There  is  often  some  uncertainty  as  to  the  exact  capital 
required,  and  it  is  quite  usual  to  take  subscriptions  for  more 
than  is  supposed  necessary,  and  call  in  only  a  certain  portion. 
I>ut  the  calling  in  of  more  is  always  a  matter  entirely  within 
the  discretion  of  the  directors,  but  if  they  do  call  it  no  one 
can  complain;  if  I  do  not  wish  to  pay  I  must  not  promise  to 
do  so.  The  cause  of  the  general  complaint  among  farmers 
when  called  upon  to  pay  "assessments"  on  non-paid-up  stock 
is  doubtless  to  be  found  in  the  self-delusions  of  enthusiastic 
promoters  of  cooperative  societies,  who  liavc  exaogeratod  ideas 
of  the  profits  of  business,  and  insufficient  knowledge  of  the 


*T  know  of  no  sucli  sluU;,  Itut  1  have  not  investigated  carefully.     They  are 
perniitted  by  British  law 


COOPKRATIVK    CORPORATIONS.  221 

amount  of  capital  required  to  transact  it.  In  soliciting  sub- 
scriptions to  stock  tliey  are  apt  to  represent — as  they  fully 
believe — that  the  first  payment  is  all  that  will  be  required  ; 
hence  when  the  call  comes  for  tlie  second  and  the  following 
payments,  there  is  disappointment  and  complaint. 

But  the  assessment  of  stock  which  has  been  fully  paid  up 
is  quite  another  matter.  If  I  subscribe  for  stock  to  the  amount 
of  $100,  I  must  not  complain  if  I  am  called  upon  to  pay  $100; 
but  if  I  am  called  upon  to  pay  more  than  that,  there  is  almost 
certainly  some  one  to  blame.  The  mere  fact  of  such  an  assess- 
ment is  ordinarily  evidence  of  mismanagement.  As  a  rule, 
when  such  assessments  are  made  they  are  for  the  purpose  of 
paying  indebtedness  which  should  not  have  been  incurred. 
The  one  who  is  usually  to  blame,  when  assessments  on  paid-up 
stock  are  made,  is  the  stockholder  himself.  In  all  corpora- 
tions the  power  rests  with  the  stockholders,  and  where  the 
power  is,  there  must  rest  the  responsibility.  It  is  true  that 
corporate  affairs  must  be  mostly  transacted  by  directors,  but 
those  directors  are  chosen  by  the  stockholders,  who  have  also 
power  to  instruct  them,  and  to  see  that  they  follow  instructions. 
It  is  true  that  we  may  be  deceived,  both  as  to  the  honesty  and 
the  ability  of  our  agents,  but  if  we  use  ordinary  diligence  in 
attending  to  our  own  corporate  business,  we  are  almost  certain  to 
discover  it  in  time  to  prevent  serious  injury.  If  we  fail  to  use 
such  diligence  we  have  no  one  to  blame  but  ourselves. 

In  nine  cases  out  of  ten  financial  trouble  in  cooperative 
corporations,  leading  to  assessments  on  j)aid-up  stock,  is  due 
to  non-attendance  of  stockholders  at  stockholders'  meetings 
and  non-use  by  stockholders  of  the  facilities  which  they  have 
provided  for  themselves,  and  which  it  would  be  to  their 
advantuge  to  make  use  of.  By  attendance  at  stockholders' 
meetings,  and  by  frequent  calls  at  its  place  of  business,  and 
conversation  with  the  managers  and  with  other  stockholders, 
the  owners  of  the  business  may  be  kept  constantly  advised  of 
its  condition  and  prospects,  and  may  always  avert  serious 
financial  trouble. 

One  very  common  cause  of  financial  trouble  in  cooperative 
societies  is  lack  of  patronage  by  the  owners  of  the  business. 


222  THE    FARMER    AS    A    COOPER ATOR. 

Suppose  a  society  organized  to  market  the  product  of  its  mem- 
bers; the  projectors  of  the  society  induce  one  hundred  members 
to  join  them;  storage  and  other  facilities  are  provided  to  take 
care  of  the  product  of  all;  connections  for  selling  are  made  at 
considerable  expense;  a  manager  is  employed  at  a  salary  pro- 
portioned to  his  responsibility  in  handling  the  entire  output 
of  the  members;  the  charge  for  selling  is  fixed  upon  the  sup- 
position that  all  will  sell  through  their  own  agency,  and,  in 
general,  all  the  preliminary  expense  of  selling  the  entire  out- 
put of  the  membership  is  incurred;  if,  then — as  I  have  known 
to  be  the  case — three-fourths  of  the  members  compete  with 
their  own  business  by  selling  through  otlier  agencies,  one  of 
two  things  must  happen:  either  those  members  who  use  the 
agency  must  pay  an  unreasonable  sum  for  its  services,  or  a 
deficit  will  be  created,  to  be  met,  in  default  of  actual  cash  on 
hand,  by  an  assessment  on  paid-up  stock;  in  different  instances 
I  have  seen  each  method  used  by  cooperative-marketing  asso- 
ciations. In  the  case  of  a  cooperative  store,  the  result  would 
be  the  same.  A  mere  deficit  in  expense,  however,  can  never 
be  serious,  as  it  is  hardly  conceivable  that  a  cooperative  busi- 
ness would  be  run  at  a  loss  for  a  long  time.  The  worst  cases 
occur  as  the  result  of  attempting  business  not  suitable  for 
farmers  to  engage  in,  wherein  employees  are  permitted  to 
make  large  purchases  of  material  on  credit  or  with  borrov/ed 
money,  or  to  make  sales  of  maimfactured  products  for  future 
delivery,  before  purchasing  the  raw  materials.  In  one  case 
that  has  been  reported  to  me,  some  stockholders  in  a  coopera- 
tive cannery  have  been  driven  to  the  verge  of  bankruptcy 
by  operations  which,  as  stated  to  me,  were  about  as  follows: 
an  employee  of  a  cannery  desired  to  be,  or  to  be  retained,  as 
superintendent;  not  succeeding,  he  went  among  the  neighbor- 
ing farmers  and  organized  a  cooperative  cannery,  to  be  man- 
aged by  himself;  indebtedness  was  incurred  for  buildings, 
machinery,  sugar,  packages,  and  labor;  the  superintendent 
was  an  active  man,  and  succeeded  in  making  very  large  con- 
tracts for  canned  goods  early  in  the  season ;  the  fruit  crop, 
however,  proved  short,  and  he  was  compelled  to  pay  much 
higher  prices  than  he  expected,  making,  however,  most  of  his 


COOl'KKATIVK    COKi'OKATIONS.  223 

purchases  from  stockholders,  who  were  to  be  paid  from  the 
sales  of  the  canned  goods.  In  due  time  they  were  shipped, 
and  rejected;  they  had  not  been  properly  put  up,  and  were 
spoiled;  meantime  canned  goods  had  advanced,  and  the  pur- 
chasers insisted  on  delivery  of  sound  goods,  according  to 
contract;  this  the  corporation  was  unable  to  do,  and  those  to 
whom  they  had  sold  bought  elsewhere,  at  much  higher  prices, 
charging  the  difference  to  the  cooperative  society,  against 
which  they  obtained  judgment;  and  the  outcome  of  the  whole 
business  to  the  stockholders  was  an  entire  loss  of  their  crop, 
which  was  spoiled,  and  an  assessment  to  pay  for  all  the  other 
material  and  labor  used,  as  well  as  the  machinery  and  other 
permanent  plant,  which  was  worth  next  to  nothing  at  forced 
sale;  and  in  addition  to  all  this,  there  were  large  sums  due  as 
damages  to  those  to  whom  they  sold  goods,  but  could  not 
deliver.  A  single  individual,  in  such  a  case,  would  simply 
surrender  his  property,  go  through  insolvency,  and  begin 
again;  the  stockholders  in  this  corporation,  however,  being 
all  farmers  with  more  or  less  property,  were  generally  "good" 
for  their  share  of  the  loss,  which  was  put  into  judgments  against 
them,  and  gradually  collected. 

The  above  illustrations  are  given  to  show  the  causes  of 
failure,  and  the  dangers  of  cooperative  work;  in  one  case,  the 
trouble  arose  because  the  stockholders  did  not  attend  to  and 
sustain  their  own  business;  in  the  last,  because  they  engaged 
in  a  risky  business,  which  they  did  not  understand;  in  both 
cases,  the  stockholders  alone  were  responsible;  they  could  have 
sustained  the  business  which  was  suitable  for  them,  and  could 
have  kept  out  of  the  other.  In  both  cases  they  were  better 
off  in  an  incorporated  society  than  they  would  have  been 
without  incorporation.  It  is  not  "corporations"  which  farmers 
have  to  fear,  but  irresolution  and  foolishness. 

No  corporation  can  lawfully  engage  in  any  business  which 
is  not  specified  in  its  articles  of  incorporation.  The  first  step, 
therefore,  toward  safety  in  cooperative  corporations  is  to  exactly 
specify  in  those  articles  the  business  to  be  engaged  in,  in  such 
terms  as  to  exclude  everything  else.  It  is  a  common  practice, 
in  drawing  these  articles,  to  make  them  very  general  in  their 


224  THE    FARMER    AS    A    COOPEKATOK. 

terms,  so  as  to  permit  almost  anything  at  all  related  to  the 
proposed  business  to  be  done;  as,  for  example, "  to  buy,  receive, 
sell,  dry,  can,  or  preserve  fruit,"  when  the  real  intention  is 
simply  to  receive  and  sell  fruit,  and  the  articles  should  read, 
as  the  purpose  of  the  corporation,  "To  receive,  store,  and  sell 
fruit,  for  cash  only."  Under  their  powers,  by  the  first  reading, 
an  incompetent  board  of  directors  might  lawfully  bankrui)t 
every  stockholder;  by  the  latter  form,  at  the  worst,  they  could 
be  only  mulcted  in  a  small  sum  for  expenses.  Thoughtless 
persons,  in  preparing  these  articles,  often  think  it  just  as  well 
to  put  everything  in,  with  the  idea  that  they  "may  want  to  do 
some  of  these  things  sometime;"  this,  however,  is  no  reason; 
if  the  purposes,  as  originally  drawn,  are  ever  found  insufficient, 
a  little  trouble,  and  a  few  dollars,  will  at  any  time  set  every- 
thing right,  and  meantime  no  stockholder  can  be  involved  in 
any  way  that  he  did  not  intend.  The  articles  of  incorporation 
form  the  constitution  of  the  society;  they  constitute  a  public 
record,  to  be  filed  for  public  reference,  in  the  manner  provided 
by  the  law  of  the  state,  and  when  so  filed,  can  only  be  changed 
by  the  stockholders  themselves  in  accordance  with  the  provi- 
sions of  the  local  law.  They  should  never  be  prepared  except 
under  the  advice  of  an  experienced  attorney,  who  should  care- 
fully inform  stockholders  of  the  exact  obligations  they  assume. 
Experienced  business  men  are  far  more  competent  than  farmers 
to  frame  such  a  document,  but  it  is  safe  to  say  that  no  such 
experienced  person  ever  frames  such  a  document  except  under 
competent  legal  advice. 

The  by-laws  of  a  corporation  also  constitute  a  public 
record,  but  are  usually  filed  only  in  the  office  of  the  corpora- 
tion itself,  where  they  must  always  be  subject  to  public 
inspection.  It  is  well  to  have  legal  advice  in  preparing  these 
also,  but  it  is  not  so  important  as  in  the  case  of  the  articles  of 
incorporation.  As  a  draft  is  usually  prepared  in  advance  for 
submission  to  the  stockholders,  it  is  very  desirable  to  submit 
the  proposed  by-laws  to  an  attorney  before  presenting  them  to 
the  stockholders. 

The  reason  of  this  is  obvious.  The  by-laws  of  a  corpora- 
tion should  contain: — 


COOPERATIVE  CORFOKATIONS.  225 

1.  Such  formal  directions  for  conducting  the  business  as 
may  be  prescribed  by  law;  these  must  all  be  observed,  whether 
in  or  out  of  the  by-laws,  but  as  the  printed  statutes  are  not 
always  conveniently  accessible  to  the  officers,  they  should  all 
be  in  the  by-laws  for  reference,  which  is  very  necessary,  as  all 
corporate  business  must  be  transacted  strictly  in  accordance 
with  law. 

2.  Such  other  directions,  and  limitations  upon  the  power 
of  the  directors,  not  inconsistent  with  law,  as  the  stockholders 
may  desire.  If  inconsistent  with  law  they  are  of  course  void, 
and  if  not  properly  drawn  they  may  fail  of  their  intended 
effect.  It  will  be  readily  seen  that  good  legal  advice  may  be 
very  valuable  in  preparing  by-laws.  In  general,  whatever  is 
v/orth  doing  is  worth  doing  well. 

In  fact,  it  is  desirable  to  act  under  legal  advice  until  the 
corporation  is  fairly  started  in  business,  with  all  the  required 
legal  records  made,  and  all  books  required  by  law  to  be  kept 
opened;  after  that  the  common  sense  of  the  directors,  and 
especially  of  the  president  and  the  secretary,  should  be  suffi- 
cient for  such  simple  transactions  as  cooperative  societies 
ought  to  engage  in.  Cor[)orations  controlled  by  trained  busi- 
ness men,  act  constantly  under  legal  advice  in  all  transactions 
outside  the  regular  routine  of  business;  cooperative  corpora- 
tions, however,  ought  to  engage  only  in  simple  transactions, 
as  to  which,  when  the'  routine  is  once  learned,  no  further 
advice  is  necessary. 

The  main  reason  for  such  care  in  the  organization  of  a 
cooperative  corporation  is  the  effect  which  it  has  on  its  credit. 
Many  cooperative  societies  are  so  situated  as  to  require  tem- 
porary loans  during  the  marketing  season,  in  order  to  avoid 
undue  pressure  in  marketing  their  output.  This  is  customary 
among  the  trade,  and  is  perfectly  legitimate.  Suppose  a  cooper- 
ative incorporated  society  for  marketing  dried  fruits,  of  which 
there  are  many  in  California.  The  object  of  these  societies  is 
to  prevent  undue  depression  in  the  local  market  from  the 
pressure  to  sell  by  those  in  immediate  need  of  money.  Nearly 
all  that  class  of  persons  may  be  glad  to  unite  in  a  cooperative 
society,  but  they  need  a  portion  of  the  value  of  their  crop  as 
15 


220  THE    FARMER    AS    A    COOPERATOR. 

soon  as  it  can  be  delivered  to  the  warehouse.  As  it  will  not 
be  immediately  sold,  the  corporation  must  borrow  money  to 
make  the  advance.  It  will  be  found  difficult,  however,  to  give 
the  necessary  security.  It  is  inconvenient,  and  in  fact  usually 
impossible,  to  pledge  the  product,  as  it  is  ordinarily  graded 
and  inseparably  mixed  with  other  products,  upon  which, 
perhaps,  no  advance  is  desired,  and  at  any  rate  as  the  material 
is  constantly  coming  in  and  going  out,  it  is  exceedingly  incon- 
venient to  be  constantly  executing  pledges,  and  obtaining 
releases  from  day  to  day  as  it  moves.  It  is  desirable,  there- 
fore, to  obtain  these  necessary  loans  upon  the  general  credit  of 
the  corporation,  which  is  itself  fully  secured,  as  it  holds  posses- 
sion of  the  product  upon  which  the  advance  is  made.  If, 
however,  application  is  made  to  the  local  bank,  it  is  probable 
that  any  loan  to  the  corporation  will  be  refused. 

The  reason  of  this  is  apparent.  It  has  already  been  shown 
that  a  corporation  is  safer  for  the  individual  stockholder  than 
an  unincorporated  society;  but  by  as  much  as  it  is  safer  to 
the  stockholder,  by  so  much  is  it  rendered  unsafe  to  a  creditor 
of  the  corporation;  a  bank,  therefore,  will  often  refuse  a  loan 
to  a  corporation  which  it  would  gladly  make  on  the  joint  note 
of  a  small  number  of  its  stockholders.  It  is  easy  to  see  the 
reason  of  this;  of  course  notes  executed  to  banks  in  the  ordi- 
nary transaction  of  legitimate  mercantile  business  are  usually 
paid  at  maturity.;  but  sometimes  they  are  not,  and  prudent 
bank  officers,  in  making  loans,  must  invariably  consider  what 
would  happen  should  they  be  forced  to  collect  the  note  by 
law ;  if,  therefore,  a  loan  to  a  corporation  were  contemplated, 
the  matter  would  be  referred  to  the  attorney  of  the  bank,  who 
would  proceed  to  inquire  as  follows: — 

1.  Is  the  society  legally  incorporated? 

2.  Are  its  present  directors  legally  chosen? 

3.  Have  they,  under  the  articles  of  incorporation  ana  the 
by-laws,  the  authority  to  authorize  the  proposed  loan? 

4.  Have  they  so  authorized  it? 

5.  What  officers  are  authorized  to  sign  the  note? 

6.  What  other  indebtedness,  if  any,  is  outstanding  again.st 
the  corporation? 


c'oopi':rative  corporations.  227 

If,  upon  exanniuitioii  of  the  records,  the  attorney  is  able  to 
give  an  unequivocal  "yes"  to  the  first  four  questions,  and 
satisfactory  replies  to  the  last  two,  the  way  to  the  desired  loan 
is  greatly  smoothed ;  if  the  records  do  not  permit  such  unequiv- 
ocal replies  to  be  made,  the  bank — if  a  safe  one  to  deposit 
in — will  refuse  to  loan.*  These  six  questions  having  been 
satisfactorily  answered  by  the  bank's  attorney,  the  bank  itself 
lias  then  to  consider  the  amount  of  property  subject  to  attach- 
ment, belonging  to  the  corporation,  the  value  of  goods  in  its 
possession,  upon  the  security  of  which  the  proceeds  of  the 
proposed  loan  are  to  be  reloaned  to  individuals,  and  the 
character  and  ability  of  those  in  charge  of  the  corporate  busi- 
ness; if  a  satisfactory  showing  is  made  on  these  points,  there 
is  no  reason  why  the  loan  to  the  corporation  should  not  be 
made. 

In  farmers'  cooperative  societies  there  is  almost  no  question 
of  the  honesty  of  the  president  and  directors;  known  to  each 
other  as  the  stockholders  are,  it  is  practically  certain  that  the 
management  will  be  honest.  There  is,  however,  danger  of 
mistakes  resulting  from  business  inexperience,  and  it  fre- 
quently happens  that  banks  require  a  year  or  two  of  successful 
experience  before  granting  loans  to  cooperative  societies,  even 
if  known  to  be  properly  organized.  In  this  case  money  can 
only  be  borrowed  for  the  corporation  on  the  joint  individual 
notes  of  the  directors  or  other  stockholders.  This  is  a  common 
custom  in  the  case  of  corporations  organized  for  profit,  in 
Avhich  the  directors  frequently  own  a  controlling  interest 
which  makes  them  willing  to  become  personally  liable  in 
transactions  wholly  under  their  control,  and  from  which  tiiey 
expect  to  derive,  through  their  holdings  of  stock,  personal  profit. 


*The  officer  primarily  responsible  for  the  orderly  conduct  of  corporate  busi- 
ness and  the  due  entry  of  the  necessary  records,  is  the  secretary.  A  good 
secretary  is  invaluable,  and  should  never  be  changed  if  it  can  be  avoided.  His 
familiarity  with  what  has  been  done,  and  with  the  necessary  legal  forms  of 
transacting  corporate  business,  make  him  invaluable  to  the  business.  It  may 
be  proper  to  suggest  that  the  secretary  should  have  no  executive  connection 
with  the  business,  or  any  responsibility  for  funds  or  monetary  transactions;  let 
him  be  purely  a  recording  officer,  under  no  possible  temptation  to  falsify  or 
obscure  the  record. 


228  THE    FARMER    AS    A    COOPERATOR. 

Corporate  notes  are  not  liked  by  banks,  and  some  banks  refuse 
them  entirely,  for  fear  of  legal  informalities  in  their  business; 
banks  are  unwilling  to  incur  the  trouble  and  expense  of  inves- 
tigations. Stockholder's  liability  is  never  considered  as  a  basis 
of  security,  althougli,  should  the  worst  happen,  it  is  made 
use  of. 

Directors  in  cooperative  societies,  however,  ought  never  to 
be  expected  to  become  personally  responsible  for  debts  of  the 
corporation.  They  seldom  have  more  direct  interest  than  other 
stockholders,  devote  much  time,  gratuitously,  to  the  common 
business,  and  are  subject  to  all  the  criticisms  of  the  censorious 
and  unjust.  If,  therefore,  without  hope  of  personal  profit, 
they  are  asked  to  impair  their  own  credit  by  borrowing  money 
for  corporate  use,  it  is  hard  to  get  good  men  to  serve.  For 
these  reasons  it  is  of  great  importance  that  the  organization  of 
cooperative  corporations  be  conducted  with  the  utmost  care, 
and  under  competent  legal  advice.  By  this  means  those  con- 
cerned with  the  organization,  and  who  are  likely  to  be  the 
first  directors  and  officers,  become  familiar  with  the  proper 
methods  of  conducting  corporate  affairs,  and  are  thereby 
enabled  to  maintain  the  credit  and  standing  of  the  corpo- 
ration, and  prosecute  its  business  with  the  effectiveness  and 
vigor  which  knowledge  alone  can  give. 


CHAPEK    IV. 

ESSENTIALS     OF     SECURITY     IN      COOPERATIVE     SOCIETIES. 

THE  principal  elements  of  safety  have  been  already  men- 
tioned; they  may  be  summarized  as  follows:— 
Adequate  Capital. — In  order  to  proceed  safely  a 
careful  estimate  must  be  made  of  the  sum  required  for  perma- 
nent mvestment.  If  a  cooperative  "store"  is  contemi)lated, 
whatever  actual  cash  can  be  collected  is  enough,  provided  the 
members  of  the  society  are  of  the  right  material,  and  can  be 
depended  upon  to  purchase  their  supplies  of  their  own  store, 
each,  for  a  time,  at  some  personal  inconvenience.  If  there  be 
any  doubt  about  this,  don't  start.  If  a  creamery,  or  fruit  drier, 
or  selling  agency  be  contemplated,  carefully  estimate  the  cost 
of  the  necessary  land,  buildings,  machinery,  etc.,  together  with 
expense  of  organization  and  expense  of  carrying  on  the  busi- 
ness until  it  begins  to  earn  income;  when  everything  that  can 
be  thought  of  has  been  estimated,  add  fifty  per  cent  to  the 
amount  so  obtained;  when  stock  to  that  amount  has  been 
subscribed,  it  will  be  safe  to  go  ahead. 

Freedom  from  Debt. — By  this  is  meant  permanent  debt, 
upon  which  interest  is  paid  and  whicli  forms  a  permanent 
lien  on  the  property  of  the  corporation;  temporary  loans  for 
the  purpose  of  making  advances  on  produce,  and  which  arc 
to  be  paid  from  the  sales  of  the  produce,  are  usual  for  market- 
ing societies,  and  are  entirely  safe.  State  laws  should,  and 
probably  always  do,  set  a  limit  to  the  indebtedness  which  cor- 
porations may  incur;  in  California  the  limit  is  the  amount  of 
subscribed  capital  stock.  In  the  purchase  of  the  permanent 
plant  it  is  reasonably  safe  to  incur  indebtedness  payable  in 
yearly  instalments  running  not  over  three  years,  provided 
the  stock  necessary  to  pay  the  indebtedness  has  been  sub- 
scribed and  partly  paid  up,  the  unpaid  portion  to  be  used, 
as  paid  in,  to  pay  off  the  indebtedness;  but  no  indebtedness 

(229) 


230  THE    PARMER    AS    A    COOPER ATOR. 

is  safe  in  excess  of  seventy-five  per  cent  of  the  outstanding 
amount  due  on  unpaid  stock.  Allowance  must  always  be 
made  for  subscriptions  which  will  never  be  paid.  The  stand- 
ing of  the  subscribers,  however,  has  much  to  do  with  this,  and 
the  directors  will  usually  be  fair  judges  of  the  value  of  the 
unpaid  subscriptions.  Subscriptions  on  which  no  payment 
has  been  made  at  the  first  call  are  usually  of  no  value.  They 
should  be  counted  as  nothing,  at  all  events.  If  payment  could 
be  enforced — which  is  often  doubtful — it  would  be  foolish  to 
do  it.  In  case  of  indebtedness  to  be  met  by  deferred  pay- 
ments on  stock,  each  stockholder  should  perfectly  understand 
tliat  he  lias  an  obligation  that  must  be  met,  so  that  there  is  no 
surprise  on  his  part,  or  complaint  of  "  assessments."  Except 
for  permanent  plant,  for  which  stock  has  been  subscribed,  and 
for  a  limited  amount  calculated  to  pay  running  expenses  not 
to  exceed  a  half  year,  there  should  be  absolutely  no  debt 
permitted,  except  for  advances  on  products  under  the  control 
of  the  corporation. 

Caution  in  Making  Advances. — In  this  matter  it  is  best 
to  be  governed  by  your  banker;  indeed,  you  will  probably  be 
compelled  to  be  so  governed,  as  he  will  lend  you  no  money  if 
he  is  not  satisfied  that  you  are  making  safe  use  of  it.  It  may 
be  best,  however,  to  consider  the  matter  a  little  for  ourselves. 

Farmers  are  apt  to  consider  banks  as  the  owners  of  the 
money  which  they  lend.  This  is  true,  however,  only  to  a 
limited  degree.  The  greater  part  of  the  funds  available  for 
loans  fro.m  banks  is  the  property  of  depositors,  wlio  are  liable 
to  call  for  them  at  any  time;  banks,  therefore,  have  to  be 
extremely  cautious  in  lending;  the  time  must  be  always  short, 
and  the  security  such  that  it  can  be  instantly  converted  into 
cash  if  necessary,  and  the  margin  between  the  amount  of  the 
loan  and  the  market  value  of  tlie  security  must  always  be 
such  that  the  amount  of  tlie  loan  can  be  realized  in  any 
emergency.  Some  farm  products  form  such  a  security,  and 
some  do  not,  and  some  would  be  considered  good  security  in 
one  locality  and  not  in  another.  Their  value  as  security 
depends,  first,  upon  the  usual  demand  for  them;  secondly,  upon 
their  keeping   qualities;   and,  thirdly,  upon   their   situation. 


SECURITY    IX    COOPERATIVK    SOCIETIES.  231 

Wheat  is  good  security  the  world  over;  the  demand  is 
universal,  and  it  will  keep  for  years;  but  a  larger  margin  is 
necessary  in  California  than  in  Chicago  or  Liverpool,  because 
it  is  farther  from  market.  Indian  corn  is  far  better  security 
in  Illinois  than  in  California,  because  the  demand  is  greater 
there ;  on  the  contrary,  any  one  can  see  that  a  car-load  of  fresh 
fruit  is  worthless  as  security  ;  it  is  not  accepted  as  security 
even  for  freight.  All  produce  is  better,  as  security,  in  the 
hands  of  a  trader,  on  the  way  to  market,  than  in  the  warehouse 
of  the  producer,  unsold. 

Dried  fruit  is  a  very  important  product  of  California,  but 
until  recently  has  not  been  considered  proper  security  for 
sound  banks  to  accept,  except  in  the  hands  of  dealers  and  in 
the  process  of  marketing ;  in  the  hands  of  growers  it  has  been 
practically  worthless  as  security  outside  of  one  or  two  local- 
ities where  the  interests  were  so  large  as  to  compel  bankers  to 
familiarize  themselves  with  its  value.  The  stability  of  the 
demand  has  not  been  assured,  and  it  is  very  liable  to  deterio- 
ration in  unskilled  hands;  it  is  entirely  unsafe  to  carry  over  to 
the  second  year,  as  old  fruit  always  sells  at  a  discount. 

The  fiict  that  the  result  of  the  labor  and  investment  of  the 
California  fruit-grower  has  resulted  in  a  perishable  or  a  semi- 
perishable  product,  regarded  as  unfit  for  security,  together 
wnth  the  great  distance  of  California  from  the  great  markets, 
has  placed  the  fruit-growers  of  that  state  in  a  very  serious 
position,  for  which  cooperation  seems  to  be  the  only  remedy. 
The  cooperative  societies,  however,  are  subjected  to  a  compe- 
tition from  commission  houses  so  severe  as  to  be  sometimes 
actually  vicious  and  unscrupulous;  the  strongest  weapon  of 
commission  houses  is  the  "advances"  which  they  make  to 
growers;  in  many  cases  they  advance  cash  to  cultivate  the 
crops,  taking  crop  mortgages;  this  they  do  largely  from  their 
own  capital,  bank  loans  not  being  always  available  for  that 
use;  the  moment,  however,  the  dried  product  is  ready,  bank- 
ing capital  can  be  had  through  commission  houses  to  "  move" 
it,  up  to  the  amount  of  perhaps  three-fourths  its  current  value, 
and  even  more;  with  any  such  amount  of  advance  as  that 
upon  it,  however,  it  must  be  Irpt  moviitg  and   got   into   the 


232  THE    FARMER    AS    A    COOPERATOR. 

liands  of  the  purchaser  at  the  earliest  possible  moment;  tliis 
the  owner  of  the  money  secured  by  it  will  insist  upon  at  all 
hazards,  and  it  will  ordinarily  be  done  regardless  of  any 
promises  to  growers. 

Perlia])s  the  main  object  of  the  cooperative  fruit  associa- 
tions of  California  has  been  to  relieve  the  selling  pressure 
during  the  first  month  or  two  of  eacli  season,  by  providing 
means  whereby  growers  can  obtain  reasonable  advances  for  a 
short  time,  upon  their  ])roduct,  while  still  retaining  control  of 
its  sale.  It  is  considered  that  since  the  crop  requires  the 
entire  year  for  its  consumption,  during  which  time  it  will 
necessarily  be  ''carried  "  by  some  one,  it  will  be  to  the  grow- 
er's interest  to  avoid  a  forced  sale  of  the  entire  crop  during 
the  first  month  or  two,  by  "carrying"  some  portion  of  it 
himself,  not,  however,  in  a  speculative  spirit,  or  with  any 
special  expectation  of  more  than  the  proper  slight  advance  to 
offstt  interest  and  shrinkage,  which  a  dealer  would  expect. 

This,  however,  the  grower  can  not  do,  if  he  loads  up  his 
{)roduct  with  advances  approaching  its  market  value;  when 
he  does  that  liis  product  will  have  to  move ;  the  inducements 
which  commission  houses  sometimes  offer  of  very  large  ad- 
vances, as  against  comparatively  small  advances  attainable 
through  a  cooperative  society,  are  in  reality  no  advantage  to 
the  grower;  in  almost  every  instance  when  his  circumstances 
require  him  to  immediately  realize  nearly  the  full  value  of 
his  crop,  lie  will  do  better  to  sell  outright  to  some  person  able 
to  hold  it  if  he  desires. 

Dried  fruit,  nuts,  raisins,  etc.,  in  a  fruit  warehouse  in 
California,  in  charge  of  experienced  men  who  are  responsible 
for  its  condition,  is  security  for  fifty  per  cent  of  its  current 
value,  and  would  now  probably  be  so  considered  by  most  Cali- 
fornia banks,  for  a  short  loan,  with  the  understanding  that 
no  renewal  was  to  be  asked,  but  the  fruit  sold  before  the 
maturity  of  the  advance  upon  it;  this  would  probably  be 
all  that  a  banker  would  advance,  and  it  should  be  all  that 
any  cooperative  society  should  advance.  Holding  any  prod- 
uct which  you  can  sell,  and  the  proceeds  of  which  you  need, 
is  speculation,  and  he  who  speculates  on  borrowed  money  is 


SECT'RITY    IN    COOPER ATIVK    SOCIKTTES.  233 

lost.  The  cooperative  societies  of  Culilbrniu  were  organized 
as  selling  agencies  ;  if  they  acquire  the  habit  of  seeking  to 
"corner"  the  markets,  and  do  it  on  borrowed  money,  they  are 
doomed.  Hence,  while  advances  to  a  certain  extent  are  nec- 
essary and  pro^Der,  cooperative  societies  should  use  caution; 
if  the  pressure  for  advances  is  quite  general,  and  tends  to 
approach  half  the  value  of  the  product  or  more,  push  sales  a 
little  harder.  Have  no  fear  of  "weakening  the  market;" 
the  market  is  already  weakened  when  the  owners  of  a  product 
are  compelled  to  borrow  money  on  it ;  a  cooperative  marketing 
societ}'-  will  be  tested  by  its  efficiency  as  a  selling  agency 
rather  than  by  its  effectiveness  in  obtaining  loans  on  products 
held  for  an  advance. 

Simplicity  OF  Object. — It  is  perhaps  unnecessary  to  add 
to  what  has  been  said  before  on  this  topic.  At  present  cooper- 
ation is  not  competent,  in  this  country  at  least,  to  deal  with 
complex  mercantile  or  manufacturing  operations.  If  success 
is  achieved,  it  will  be  due  to  the  public-spirited  efforts  of  one 
or  two  persons,  and  not  to  the  inherent  force  of  the  cooperative 
body.  A  creamery,  a  fruit  drier,  a  selling  or  purchasing 
agenc}'',  and  similar  enterprises  may  be  expected  to  succeed 
in  communities  requiring  them. 

There  are  some  other  matters  essential  to  success,  which 
may  perhaps  be  more  appropriately  considered  under  the 
heading  of  the  next  chapter,  but  on  the  whole  a  cooperative 
enterprise  designed  to  accomplish  a  simple  and  desirable  end, 
with  adequate  capital  and  free  from  debt,  ought  to  succeed. 


CHAPTER    V. 

ELEMET^TS    OF   DANGER    IN    COOPERATION. 

FAILURE  ill  the  main  to  be  governed  by  the  rules  sug- 
gested in  the  last  chapter,  or  carelessness  in  the  matters 
of  organization,  are  of  course  elements  of  danger,  but 
in  this  chapter  I  shall  have  reference  to  matters  which, 
although  seriously  important,  are  yet  not  absolutely  funda- 
mental; matters  in  which  such  errors  as  may  occur  may  be 
corrected  without  reconstruction  of  the  entire  business. 

Neglect  of  Stockholders. — This  has  been  already  al- 
luded to,  but  it  can  hardly  be  made  too  prominent.  The 
stockholders  are  the  owners  of  the  business,  and  if  they  do 
not  carefully  watch  it,  who  will?  I  have  never  myself  seen 
serious  trouble  from  this  cause  in  neighborhood  associations 
which  have  been  started  on  a  sound  financial  basis,  and 
whose  members  are  necessarily  well  acquainted  with  each 
other,  but  in  more  extensive  marketing  associations,  whose 
operation  extends  over  considerable  areas,  and  perhaps  an 
entire  state,  the  inattention  of  stockholders  is  a  serious  diffi- 
culty. The  tendency  of  farmers  in  such  cases  is  to  regard  "  the 
company"  as  a  mysterious  entity,  existing  somehow  and 
somewhere,  to  which  they  have  perhaps  "contributed"  grudg- 
ingly something,  and  whose  operations  are  calculated  to  help 
them  in  some  way  without  thought  or  effort  on  their  part. 
The  notion  of  the  corporation  as  a  business  enterprise  of  which 
they  are  part  owners,  which  expects  the  support  of  their  busi- 
ness, and  for  whose  financial  success  they  are  in  part  respon- 
sible, can  hardly  be  said  to  exist  among  farmers.  Perhaps 
this  point  may  be  treated  more  profitably  by  considering  the 
infirmities  which  are  the  cause  of  it. 

Ignorance. — This  is  the  foundation  of  most  trouble,  and 
certainly  of  the  non-support  of  cooperative  societies  by  their 
own  stockholders.     The  ignorance  of  most  farmers  in  regard 

(234) 


ELEMKXTS    OK    |)AN(iKll    IN'    ( 0(  H'KI;  ATIOX.  235 

to  business  transactions  outside  the  immediate  operations  ui' 
the  farm  is  astonishing.  The  merchant  is  j)erhaps  as  ignorant 
of  farming  operations  as  the  farmer  is  of  trade,  but  he  has  no 
need  to  be  otherwise,  as  be  deals  only  with  completed  prod- 
ucts, and  need  not  concern  himself  with  the  processes  of 
production — although  to  be  sure  he  is  a  better  merchant  if  he 
does  understand  them — but  the  farmer  who  must  bear  all  the 
risk  of  production  is  vitally  interested  in  the  mercantile  con- 
ditions and  operations  affecting  the  distribution  of  his  product. 

I  can  best  illustrate  my  meaning  by  an  example.  The 
fruit-growers  of  California  are  engaged  in  a  very  risky  busi- 
ness; their  product,  if  sold  fresh,  is  perishable;  if  sold  dried,  is 
semi-perishable;  they  are  thousands  of  miles  from  market, 
and,  on  nearly  all  their  products,  are  exposed  to  competition 
from  other  districts  or  other  countries  having  cheaper  laboi' 
and  cheaper  transportation  to  the  great  markets;  their  busi- 
ness requires  far  more  capital  than  ordinary  farming,  and 
their  investments  require  careful  attention  and  constant 
increase  for  years  before  yielding  any  returns  whatever;  they 
are  probably  the  most  intelligent  body  of  agriculturists  in  tlie 
world,  and  yet  up  to  the  beginning  of  cooperative  work  in 
that  state  it  is  doubtful  if  there  were  a  dozen  of  their  number 
who  could  give  any  intelligent  account  of  the  processes  by 
which  their  product  reached  the  table  of  the  consumer,  the 
necessary  expense  of  those  processes,  or  of  the  character  and 
extent  of  the  competition  to  which  they  are  exposed.  The 
mixed  farmer  of  Ohio,  or  the  wheat-grower  of  Minnesota,  has 
not  the  same  need  of  this  knowledge ;  his  goods  are  staple  and 
the  markets  are  at  hand;  if  one  crop  proves  unprofitable  he 
can  the  next  year  change  to  another  crop;  but  to  the  specialist, 
cultivating  orchards  under  the  circumstances  prevailing  in 
California,  this  mercantile  knowledge  is  vital,  as  hundreds 
wdio  entered  upon  the  business  without  it  have  learned  to 
their  sorrow. 

Suspicion. — This  is  the  child  of  ignorance,  and  invariably 
attends  it;  and  it  is  born  not  only  of  ignorance,  but  of  experi- 
ence. The  ignorant  man  is  the  natural  prey  of  the  designing 
man,  and  having  been  often  deceived  is  constantly  expecting 


236  THE    FARMER    AS    A    COOPERATOR. 

deception.  A  man  ignorant  of  business  processes  has  no 
means  of  distinguishing  tlie  projects  of  the  schemer  or  the 
enthusiast  from  the  sensible  proposals  of  the  sound  business 
man,  and  as  the  former  always  promise  more  largely,  he  is 
more  likely  to  be  attracted  by  them,  and  to  be  continually 
disappointed.  It  is  surprising  to  meet  persons  so  generally 
intelligent  as  manj^  farmers  are,  and  yet  so  completely  igno- 
rant regarding  many  business  transactions  which  concern 
them,  and  consequently  so  suspicious  of  those  proposing 
improved  methods. 

Infirm  Will. — This  seems  to  me  the  greatest  infirmity  of 
human  nature.  It  seems  to  be  possible  for  bright  talkers  of 
strong  will  power  to  persuade  most  men  to  act  contrary  to 
what  would  be  their  cool  judgment.  It  is  my  observation 
that  when  cooperative  societies  are  formed  the  majority  of  the 
members  are  obtained  only  after  the  most  earnest  canvassing 
by  a  small  number  of  enthusiasts;  I  have  personally  assisted 
in  the  formation  of  a  large  number  of  cooperative  societies, 
and  perhaps  have  induced  as  many  persons  as  any  one  ever 
induced  to  sign  their  names  to  the  stockholders'  lists  of  such 
enterprises,  and  I  can  remember  hardly  an  instance  where 
any  one  not  of  the  number  of  the  original  promoters  gave  his 
signature  without  serious  and  exhausting  arguments;  I  have 
always  been  a  hard  worker,  but  have  never  done  any  work  so 
exhausting  as  canvassing  for  membership  in  a  cooperative 
society;  of  the  hundreds  whom  I  have  induced  to  join  such 
societies,  I  do  not  believe  that  one  third  could  have  been 
secured  except  as  the  result  of  this  earnest  canvassing;  nor  do 
I  believe  that  there  were  more  than  one  in  three  who  could 
not  be  persuaded  after  having  joined  the  society  to  compete 
with  it  by  doing  their  business  elsewhere. 

The  experience  of  the  California  Fruit  Union,  with  which 
I  was  never  connected,  is  a  fair  sample  of  this.  Sometime  in 
"the  eighties"  the  growing  output  of  fresh  fruit  in  California 
had  outstripped  the  then  existing  shipping  and  marketing 
arrangements,  and  the  growers  were  making  no  money.  In 
this  state  of  affairs,  as  the  result  of  many  large  meetings, 
and  amidst  much  popular  enthusiasm,  the  "California  Fruit 


ELEMENTS   OF    DANGER    IN    COOPERATION.  237 

Union"  was  organized  as  a  fresh-fruit  shipping  association, 
owned  aiul  controlled  by  the  growers  themselves.  A  very 
large  number  of  growers,  including  most  of  the  largest,  became 
stockholders,  and  for  some  years  the  Union  was  the  largest 
shipper  of  fresh  fruit  from  California,  and  all  its  operations 
appear  to  have  been  honestly  and  effectively  conducted.  It 
secured,  from  the  start,  many  concessions  and  advantages  to 
the  growers,  which  would  otherwise  have  been  delayed  for 
years.  After  a  successful  existence  for  several  years,  the  Union, 
in  1894,  went  out  of  business. 

The  cause  of  this  practical  failure  of  cooperative  work  was 
the  instability  of  character  of  the  mass  of  its  stockholders. 
Personal  dissensions  arose  between  some  of  tlie  largest  ship- 
pers, causing  some  withdrawals,  but  it  is  probable  that  the 
majority  of  the  withdrawals  of  large  shippers  grew  rather  from 
a  speculative  fever  which  passed  through  the  state,  causing 
some  who  had  been  successful  to  engage  in  large  plantings 
ou  credit,  which  soon  brought  with  it  the  necessity  for  large 
advances,  which  could  only  be  secured  by  a  practical  or  actual 
mortgage  of  the  crop  to  commission  men,  who,  of  course,  insisted 
on  marketing  the  fruit.  But  it  was  found  that  the  great  mass 
of  smaller  growers,  whose  aggregate  output  is,  on  the  whole,  the 
controlling  factor,  could  not  be  depended  upon  at  all.  Com- 
mission houses,  seeking  the  business,  flooded  the  state  with 
incisive  "talkers,"  who  found  no  difficulty  whatever  in  exciting 
in  the  minds  of  the  fruit-growers  distrust  of  and  even  enmity 
to  the  agency  of  their  own  creation.  Tlie  plan  of  concentrating 
the  shipments  under  one  general  management,  sufficiently 
powerful  to  insure  the  widest  distribution  possible,  was  thus 
defeated  by  the  mental  weakness  of  its  members.  Tiiere  was 
never  any  ground  for  serious  complaint  of  the  management, 
and  even  if  certain  alleged  abuses  had  existed,  growers  would 
have  been  far  better  off  to  have  shipped  through  the  Union, 
and  permitted  them  to  continue.  But  they  were  infirm  of 
purpose,  and  sharpers  were  quick  to  take  advantage  of  them. 
There  was  another  reason  which  brouglit  about  the  final 
winding  up  of  a  business  which  was  still  large  and  reasonablv 
prosperous.     Fresh  fruit  is  a  very  perishable  commodity,  upon 


238  THE    FARMER    AS    A    COOPERATOR. 

which  freight  has  to  be  always  guaranteed;  the  freight  between 
California  and  the  east  was  not  less  than  $300  per  car,  and  it 
often  happened  that,  when  sold,  it  did  not  bring  enough  to  pay 
cliarges.  These,  however,  were  guaranteed  by  the  Union,  and 
paid,  but  when  it  attempted  to  repay  itself  by  collecting  the 
loss  from  the  individual  owners  of  the  fruit,  in  many  cases  it 
practically  could  not  be  done.  The  result  was  that  the  large 
and  responsible  sliippers,  who  could  be  reached,  were  com- 
pelled to  pay  the  majority  of  all  such  losses  of  others,  and  they 
got  tired  of  it.  All  these  things  are  useful  as  illustrating  tlie 
real  character  of  human  nature,  with  which  cooperative  enter- 
prises must  deal. 

I  have  stated,  at  the  beginning  of  this  chapter,  that  the 
dangers  I  was  about  to  discuss  were  not  absolutely  funda- 
mental, whereas  those  which  are  based  on  the  characteristics 
of  human  nature  of  course  really  do  lie  at  the  foundation  of 
things.  But,  in  the  use  of  that  term,  I  referred  to  the  consti- 
tution of  the  organization,  and  not  to  tlie  character  of  its 
members.  With  a  proper  organization,  and  sufficient  time 
and  patience,  we  may  expect,  by  education,  to  overcome  the 
infirmities  of  human  nature. 

Incompetence  in  Management.— A  merchant,  thoroughly 
understanding  his  business,  knows  exactly  what  qualities  he 
desires  in  his  emj)loyees,  and,  being  in  continual  contact  with 
them,  knows  whether  they  have  them,  and  whether  they  do 
their  duty.  As  there  are  no  personal  profits  in  cooperative 
work,  it  is  very  difficult  to  insure  the  same  supervision  of  the 
salaried  staff  that  is  found  in  a  private  business.  The  real 
owners  of  the  business  have  none  of  them  an  amount  at  stake 
which  justifies  them  in  taking  tlie  time  necessary  to  properly 
overlook  it.  It  is  also  nearly  always  the  case  that  the  mana- 
ger and  other  paid  persons  know  more  about  the  business  than 
any  of  their  employers.  Under  these  circumstances,  which  are 
almost  inseparable  from  distributive  cooperation  on  any  large 
scale,  the  principal  guarantee  of  good  management  lies  in  the 
value  of  the  personal  equation  of  the  directory,  which,  in  a 
large  organization,  covering  a  wide  area,  is  certain  to  be  much 
higher  than  that  of  the  average  equation  of  the  stockholders. 


ELEMKXTS  OF  DANGKR  IX  COOPERATION.        230 

There  are,  however,  many  facts  and  considerations  which  can 
be  definitely  formulated,  and  which,  if  thoroughly  digested 
and  properly  acted  upon,  ought  to  insure  both  competent 
and  honest  management.  Some  of  these  things  might  be 
quite  properly  discussed  under  the  heading  of  this  chapter, 
but  their  importance  justifies  a  separate  grouping. 

In  this  connection  I  may  say  that  it  is  not  necessary,  nor 
will  it  usually  be  possible,  that  the  manager  of  a  cooperative 
enterprise  should  be  one  of  the  class  known  as  "successful 
business  men" — that  is,  men  of  wealth.  Such  men  invariably 
have  a  strong  accumulating  instinct,  and  the  idea  of  coopera- 
tion does  not  permit  the  accumulation  of  private  fortunes  by 
the  profits  of  distribution.  There  is  no  money  to  be  made, 
honestly,  in  these  positions.  As  a  class,  also,  such  men  are 
nearly  destitute  of  sentiment,  a  fair  touch  of  which  is  essential 
to  induce  men  of  ability  to  lead  cooperative  movements. 

Fortunately,  such  men  are  not  necessary.  The  majority 
of  really  good  business  men  do  not  possess  the  accumulating 
instinct.  They  are  often  unwilling  to  submit  to  the  privations 
upon  which,  in  most  cases,  the  foundations  of  large  fortunes 
are  laid,  preferring  the  comforts  of  home  and  the  advancement 
of  those  dependent  upon  them,  to  the  accumulation  of  wealth. 
The  brains  and  push  of  all  great  business  organizations  is 
largely  composed  of  such  men,  who  sell  their  talents  and  vigor 
for  a  fixed  compensation,  to  colder-blooded  men,  who  make  a 
profit  on  them,  and  secure  the  reputation  for  business  ability, 
which  should,  in  great  measure,  be  shared  by  their  employees. 
They  are  also,  of  course,  themselves  men  of  ability.  To  become 
very  rich,  you  must  be  very  able;  but  you  may  be  very  able 
and  never  become  rich. 


CHAPTER  VI. 

MANAGEMENT    OF    COOPERATIVE    SOCIETIES. 

BY  the  "management"  in  this  chapter  I  mean  the  salaried 
staff,  who  will  ordinarily  be  appointed  by  the  directors, 
and  not  be  members  of  that  body.  In  making  these 
appointments— especially  the  principal  officer — there  are  four 
things  to  be  particularly  considered: — 

1.  The  qualifications  necessary. 

2.  Methods  of  determining  the  possession  or  lack  of  those 
qualities. 

3.  The  money  value  of  the  service  to  be  rendered. 

4.  Influences  to  be  guarded  against. 

It  will  be  profitable  to  consider  these  points  in  their  order. 

Necessary  Qualifications. — The  perfect  manager  of  a 
cooperative  distributing  society  will  possess  many  qualifica- 
tions not  usually  found  in  one  person,  and  the  perfect  manager 
is  not  likely  to  be  found;  but  it  will  be  useful  to  set  down  the 
qualities  which  the  perfect  manager  would  have,  tliat  in  con- 
sidering the  appointment  of  a  mere  human  being,  directors 
may  check  off  in  their  minds  just  which  of  these  qualities  the 
candidate  has,  and  which,  if  any,  he  lacks. 

Integrity. — That  this  is  essential  needs  no  argument,  nor 
is  there  much  danger  that  one  not  believed  to  be  honest  will 
be  appointed  manager  of  any  important  cooperative  enterprise: 
but  the  grade  of  integrity  required  in  the  manager  of  an  impor- 
tant coo])erative  concern  is  of  no  ordinary  kind;  and  there  is 
always  some  danger  that  it  may  not  be  found  associated  with 
some  otlier  essential  qualities,  in  those  available  for  service  in 
a  salaried  capacity.  There  are  grades  of  honesty  which  can 
resist  ordinary  temptations  and  yet  succumb  to  those  which 
are  extraordinary,  and  the  manager  of  a  large  cooperative 
enterprise  will  be  continually  exposed  to  the  latter. 

I  do  not  refer  to  the  mere  custody  of  funds;  ordinary  pru- 
(240) 


MANAGEMENT    OF    COOPERATIVE    SOCIETIES.  24] 

dence  on  the  part  of  directors  will  nearly  always  be  a  sufficient 
guard  against  embezzlement;  and  in  all  events  there  will  be 
the  security  of  a  bond.  And  this  bond,  by  the  way,  should 
always  be  that  of  a  security  company,  and  not  that  of  an 
individual.  No  man's  integrity  can  be  absolutely  assured, 
and  tlicro  is  no  reason  in  asking  an  uninterested  third  party 
to  pay  for  his  mistaken  confidence  in  the  honesty  of  a  fxiend. 
Besides,  such  bonds  are  often  unsafe  and  uncollectable.  The 
bond  of  a  security  company  for  $1,000  is  better  than  a  friendly 
bond  for  $10,000.  In  the  first  place,  the  thorough  investiga- 
tion w^hich  the  company  must  make,  before  insuring,  is  a 
great  safeguard,  and,  secondly,  the  absolute  certainty  of 
prompt  and  relentless  prosecution  to  follow  the  discovery  of 
any  wrong-doing  is  the  most  powerful  restraint  on  any  such 
inclination.  The  usual  charge  for  such  insurance  is  one  per 
cent  per  annum  on  the  amount  of  the  bond.  It  amounts  to  a 
reduction  of  salary  to  that  extent,  and  should  be  paid  by  the 
corporation,  who  will  in  that  way  most  readily  secure  a  bond 
of  that  kind.  It  will  be  hard  to  refuse  the  tender  of  what 
appears  to  be  a  sufficient  individual  bond,  and  the  tendency 
of  the  employee  will  be  to  save  himself  the  expense  of  the 
security  bond  by  inducing  some  friend  to  become  responsible 
for  him. 

But  there  are  more  serious  temptations,  arising  from  the 
power  of  the  manager  to  throw  business,  and  against  this  no 
bond  can  provide.  If  there  are  purchases  to  be  made,  he  can, 
if  he  will,  secure  private  commissions  on  these  purchases;  and 
if  there  are  sales  to  be  made  through  brokers,  he  can  obtain  a 
private  interest  in  the  brokerages. 

The  Manager  Is  Sure  to  be  Tempted. — Sooner  or  later  these 
advantages  will  be  offered  him  by  some  unscrupulous  person 
who  believes  that  all  men  have  their  price.  It  is  not  likely, 
at  first,  to  be  a  direct  and  open  offer  which  can  be  openly 
resented  and  reported,  but  there  will  be  conversation  opening 
the  way  to  advantages  of  some  kind  to  be  given  to  the  man- 
ager, in  return  for  undue  favors,  which  will  rapidly  crystallize 
into  actual  business,  if  the  manager  proves  susceptible.  And 
it  is  possible  for  so  large  an  advantage  to  come  to  him,  with 
16 


242  THE    FARMER    AS   A    COOrERATOR. 

such  infinitesimal  injury  to  any  individual  member  of  the 
company,  that  the  temptation  may  be  very  strong. 

The  Manager  Is  Sure  to  be  Suspected.— I  think  this  the  great 
danger-point  of  cooperative  distribution.  There  is  a  mean 
streak  in  humanity  which  seems  to  make  us  unable  to 
assume  good  motives  when  those  which  are  improper  can 
be  imputed.  I  fear  there  is  no  sanction  of  honest  life,  however 
long  continued  or  conspicuously  displayed,  which  can  insure 
against  insinuations  of  evil,  which  are  all  tlie  more  galling  that 
they  are  seldom  so  openly  made  that  they  can  be  disputed; 
indeed,  it  would  be  useless  to  dispute  them,  for  tliey  can  no 
more  be  disproved  than  proved;  for  it  is  true  tliat  honest  life 
does  not  insure  continued  honesty;  and  tlie  knowledge  of  the 
suspicion  which  will  surely  come  to  all  in  these  positions, 
seems  to  be  more  likely  than  all  other  influences  to  break 
down  the  moral  fiber  of  the  suspected  man.  The  honest  man 
has  usually  the  confidence  of  those  with  whom  he  is  in  imme- 
diate contact,  but  in  a  cooperative  society,  doing  business  for 
hundreds  of  members  who  never  see  the  manager,  there  will 
be  continual  questionings  of  his  honesty.  Knowing  this  to  be 
true,  there  is  danger  that  the  time  may  come  when,  under 
temptation,  lie  may  say,  "Of  what  use  is  the  honest  life  since 
one  gets  neitlier  the  credit  of  honesty  nor  tlie  advantage  of 
dishonesty?"  and  will  conclude  that  since  fidelity  is  repaid 
with  ingratitude,  and  no  one  can  know  certainly  whether  he 
has  been  honest  or  not,  he  may  as  well  do  what  many  believe 
that  he  does. 

This  fault  of  suspicion  lies  in  our  own  nature,  and  the 
remedy  must  be  found  in  our  own  knowledge  of  that  nature. 
The  surest  way  to  keep  an  honest  man  still  honest  is  to  trust 
him;  there  is  happily  in  our  nature,  amidst  much  evil,  a 
noble  impulse  that  leads  us  to  be  faithful  to  those  who  really 
trust  us.  Implicit  confidence,  and  monthly  verification  of 
accounts,  will  keep  most  men  honest. 

There  is  also  another  safeguard,  which,  with  that  men- 
tioned in  the  last  paragraph,  may  be  expected  to  maintain 
honesty  in  service,  and  at  any  rate,  in  connection  with  reason- 
able  trust,   is   all   that   we   can   do   to   maintain  honesty  in 


MANAGEMENT    OF    COOPER  ATI  VK    SOCIETIES.  242 

cooperative  service,  and  that  is  make  tlie  positions  wortli 
having.  I  shall  speak  of  this  more  fully  when  discussino 
methods  of  determining  value  of  personal  service,  but  I  may 
say  here  tliat  cooperative  societies  almost  universally  err  in 
making  compensation  of  leading  officers  too  small,*  the  result 
being  that  the  mental  caliber  of  those  employed  is  apt  to  be 
inadequate  to  their  duties,  and  inferior  to  that  engaged  in 
competitive  distribution.  The  consequence  is  that  really 
capable  men  will  not  care  for  the  positions,  and  when  they 
hold  them  are  less  likely^  to  be  kept  honest  for  fear  of  losing 
them.  An  honest  man  fully  trusted,  and  paid  what  the  same 
ability  and  responsibility  commands  in  competitive  business." 
is  pretty  sure  to  remain  honest. 

Brains. — The  manager  of  a  cooperative  business  must 
have  acuteness  and  judgment  in  accordance  with  his  duties. 
Greater  mental  strength  is  of  couiso  required  for  complex  oper- 
ations covering  a  wide  field  than  for  simple  duties  restricted  to 
a  more  narrow  sphere.  The  mental  ability  required  increases 
in  a  direct  ratio  with  the  number  of  things  the  manager  is  re- 
quired to  know,  and  to  consider  at  once  when  acting.  A  great 
war  always  affords  conspicuous  examples  of  excellent  division 
generals,  and  even  corps  commanders,  who  have  not  the 
mental  grasp  to  conceive  and  execute  the  combinations  neces- 
sary to  properly  direct  an  army.     It  is  the  same  in  business. 

Vigor.— There  arc  men  who  know  but  can  not  do.  In  the 
time  of  action  they  fail.  Usually  this  will  be  found  attribut- 
able to  insufficient  bodily  strength,  and  is  especially  to  be 
guarded  against  in  those  whose  age  and  experieirce  have  other- 
wise qualified  them  to  assume  responsible  positions.  In  com- 
petitive business  such  men  by  natural  selection  liave  worked 
their  way  to  the  conduct  of  a  business  whose  policy^  has  long 
been  established,  and  whose  active  work  is  performed  by 
younger  men.     Those  charged   with   direction   have  not  the 


*I  must  again  call  attention  to  the  fact  that  this  view  is  utterly  at  variance 
with  that  taken  by  all  others  who  have  written  upon  this  subject,  and  contrary 
to  the  practice  of  the  most  successful  cooperative  societies  in  the  world.  The 
contrary  view  is  that  capable  business  men,  from  altruistic  motives,  will  give 
their  services  at  less  than  their  competitive  value. 


244  THE    FARMER    AS    A    C'OOPERATOR. 

exhausting  labor  of  detail,  and  can  save  their  strength.  There 
is  danger  that  cooperative  business  may  not  develop  this  class, 
and  at  any  rate  in  their  beginning,  the  manager,  from  con- 
siderations of  economy,  will  usually  be  compelled  to  do  the 
double  duty  of  direction  and  execution,  and  the  sound  mind 
in  the  sound  body  is  essential. 

Experience. — Something  has  already  been  said  as  to  this. 
I  suppose  no  one  ever  entered  upon  a  new  business  without 
making  errors,  which  by  experience  he  gradually  learns  to 
avoid.  The  more  experience,  therefore,  that  is  available,  when 
accompanied  by  brains  and  vigor,  the  more  fortunate  the 
society  will  be.  If,  however,  the  experience  is  lacking,  the 
society  will  do  very  well  with  honesty,  vigor,  and  brains,  pro- 
vided it  fully  understands  that  errors  will  be  inevitable,  and  is 
prepared  to  endure  them  patiently,  and  pay  for  them  cheer- 
fully; for  all  errors  in  business  cost  money.  Errors  occur  and 
are  paid  for  in  competitive  business,  but  they  are  reduced  to  a 
minimum  by  natural  selection  and  regular  promotion  of  the 
most  competent,  and  when  they  occur  they  are  not  heard  oi 
outside.-  It  is  the  misfortune  of  cooperative  business  that  all 
errors  are  subject  to  public  discussion,  often  leading  to  change 
of  management  just  as  the  manager  has  learned  to  be  useful. 
Nothing  is  more  wasteful  than  continually  paying  for  the 
experience  of  new  men,  and  it  is  a  danger  to  wliich  coopera- 
tive business  is  peculiarly  exposed.  In  cooperative  business 
experience  is  desirable  not  only  in  all  branches  of  the  business 
to  be  conducted,  including  personal  acquaintance  with  those 
from  whom  or  through  whom  trade  may  be  expected,  but  also 
in  dealing  with  such  masses  of  disorganized  men  as  coopera- 
tive societies,  at  the  beginning,  will  usually  consist  of.  A 
hopeful,  earnest  man,  without  this  experience,  will  be  likely 
to  expect  and  to  rely  upon  many  things  which  will  never 
happen. 

Tact. — A  manager  is  presumably  a  salesman;  at  least  he  must 
direct  salesmen,  and  few  men  can  profitably  attempt  to  direct 
others  in  matters  in  which  they  ai-e  not  themselves  expert; 
the  salesman's  tact  is  reasonably  plenty,  and  it  is  not  to  this 
that  I  refer,  but  to  that  far  rarer  accomplishment  which  will 


MANAGE^rEXT   OF    COOPKRATIVK    SOCI ICTIES.  24."> 

enable  the  manager  to  keep  in  solid  phalanx  his  own  employ- 
ers. This  problem  is  ever  present  to  the  mind  of  tlie  manager 
of  a  cooperative  enterprise,  and  the  necessity  of  its  continual 
solution  by  new  processes  is  the  one  thing,  next  to  the  sus- 
picion with  which  they  are  regarded,  which  most  tends  to 
drive  capable  men  out  of  cooperative  service.  Competitive 
business  has  not  to  deal  with  this  trouble;  of  one  thing  the 
employee  of  a  competitive  business  is  sure,  and  that  is  the 
earnest  and  unfaltering  support  of  his  employer.  The  em- 
ployee of  a  cooperative  society,  however,  is  not  only  not  sure 
of  this  su{)port,  but  he  may  be  perfectly  certain  that  he  will 
not  have  it.  With  some  experience  as  a  leader  of  cooperative 
effort,  I  can  testify  that  nine-tenths  of  my  vital  force,  while 
engaged  in  it,  has  been  employed  in  holding  to  their  professed 
intentions  those  at  whose  solicitation  I  engaged  in  the  work. 
I  have  never  yet  been  able  to  employ  more  than  one-tenth  of 
my  power  in  forwarding  the  real  objects  of  the  association. 
Of  course  I  have  rather  been  a  pioneer,  and  engaged  in  the 
beginnings  of  enterprises,  but  I  have  had  good  opportunities 
for  observing  the  operations  of  established  societies,  and  believe 
that  upon  the  average  one-half  the  force  expended  for,  and 
paid  for,  by  cooperative  societies  is  used  up  in  keeping  the 
members  together.  It  seems  odd  that  we  should  have  to  hire 
people  to  persuade  us  to  continue  in  a  path  which  we  sa}'  we 
wish  to  walk  in,  but  we  seem  to  be  built  that  way.  It  is  a 
feature  in  which  cooperation,  in  our  present  state  of  develoj)- 
ment,  involves  a  distinct  waste  of  power,  as  compared  with 
competitive  business,  and  to  that  extent  is  cooperation  uneco- 
nomical. State  socialists,  recognizing  this  difficulty,  would 
substitute  the  power  of  the  state  for  the  persuasions  of  indi- 
viduals. This — even  if  theoretically  sound — we  are  certainly 
not  now  prepared  for,  and  cooperation,  which  is  one  phase  of 
voluntary  socialism,  must  meanwhile  depend  on  persuasion 
and  "management,"  and  for  the  present  the  manager  of  an 
extended  cooperative  societ}^  must  be  superendowed  with  tact. 
Doubtless  otiier  qualifications  could  be  enlarged  upon,  such 
as  courage,  hopefulness,  patience,  earnestness,  foresight,  punc- 
tualitv,  and  in  fact  all  the  cardinal  and  minor  virtues,  but 


246  THE    FARMER    AS    A    COOPERATOR. 

upon  the  whole  I  think  tliat  whoever  possesses  in  a  high 
degree,  integrity,  brains,  vigor,  experience,  and  tact,  is  quite 
likely  to  possess  most  other  necessary  qualities,  and  at  any 
rate  to  be  an  exceedingly  useful  person,  and  probably  a  good 
manager;  but  in  summing  up  the  requirements  it  must  never 
be  forgottei]  that  the  manager  of  an  important  cooperative 
business  must  be  equipped  to  cope  successfully  with  those  who 
by  natural  selection  have  passed  through  the  period  oi 
salaried  employment,  and  in  the  fulness  of  experience,  are  now 
managing,  as  owners,  the  great  competitive  establishments 
with  which  cooperation  itself  must  compete. 

Methods  of  Determining  the  Possession  or  Lack  of  Qualities 
Necessary  to  Conduct  Cooperative  Business-— It  is  evident  that 
the  value  of  one's  personal  equation  cannot  be  determined 
with  scientific  accuracy.  Whatever  conclusions  are  reached 
will  always  be  subject  to  a  large  margin  of  error;  in  forming 
our  judgment  of  ability  and  character  we  are  influenced  in 
very  complex  ways  by  our  impressions  of  the  person's  con- 
versation, writing,  personal  appearance,  and  his  associations 
and  history  so  far  as  known  to  us,  and  from  the  sum  of  all 
these  impressions  our  judgment  is  formed.  As  one  becomes 
more  largely  an  employer  of  men,  he  acquires  the  habit  ot 
analyzing  these  impressions,  and  assigning  in  his  mind  a 
certain  definite  value  to  each,  and  directs  his  preliminary 
inquiries  toward  the  ascertainment  of  such  definite  facts  as 
will  throw  light  upon  character.  It  must  be  remembered  that 
in  competitive  business  the  candidate  for  a  responsible  position 
will  usually  have  long  been  known  by  the  employer,  either  as 
an  employee  in  a  subordinate  capacity,  or  as  a  competitor  in 
the  same  line  of  business;  while  the  beginning  of  an  impor- 
tant cooperative  enterprise  is  subjected  to  this  disadvantage, 
that  the  selection  of  manager  must  be  made  by  those  who 
have  perhaps  not  had  experience  in  employing  business  men, 
are  imperfectly  acquainted  with  each  other,  and  may  not 
have  clear  concei)tions  of  all  the  qualities  required;  and  that 
the  selection  must  usually  be  made  from  tlio.se  without  pre- 
vious experience  in  the  exact  business  to  be  done,  or  upon  the 
scale  which  is  pro})Osod,  and  who  arc  also  perhaps  not  well 


MANAGEMENT    OF    COOPERATIVE    SOCIETIES.  247 

known  to  all  who  must  vote  upon  the  appointment.  It  seems 
probable,  therefore,  that  what  follows  may  be  useful  to  those 
coming  to  this  experience  for  tlie  first  time,  in  directing  tlieir 
minds  to  such  definite  points  as  are  essential  to  the  formation 
.of  correct  judgment  of  personal  character. 

liitegrify. — A  security  company,  wlien  insuring  the  fidelity 
of  an  employee,  must  usually  rely  upon  such  information  as  it 
obtains  of  the  business,  and  personal  history,  associations,  and 
habits  of  the  candidate.  These  items  are  scrupulously 
obtained  both  from  the  statements  of  the  person  in  question, 
and  from  those  with  whom  he  has  been  associated,  whether 
given  as  references  or  not.  Bad  character  is  almost  certain  to 
carry  with  it  bad  repute;  or  if  most  carefully  concealed,  at 
least  suspicion.  A  man  of  clean  record  and  good  habits  and 
associations,  and  free  from  debt,  is  a  first-class  risk  of  a 
security  company,  but  even  such  men  sometimes  go  wrong. 
In  addition  to  tliis  the  employer  will  always  have  the  advan- 
tage of  at  least  some  personal  acquaintance.  One  thing  must 
always  be  inquired  into:  Is  the  candidate  in  debt  beyond 
reasonable  expectation  of  payment?  and  if  so,  under  what 
circumstances  was  the  indebtedness  contracted,  and  what 
arrangements  have  been  made  for  its  extinguishment,  either 
by  payment  or  compromise?  Especially  is  he  harassed  by 
unsecured  small  debts?  Indebtedness  can  not  be  considered  a 
bar  to  responsible  employment,  altliougli  freedom  from  debt  is 
certainly  a  great  recommendation,  but  no  concern  can  afford 
a  responsible  employee  who  does  not  pay  his  bills;  and  there 
are  unfortunately  many  attractive  and  even  brilliant  men 
who  intend  and  really  believe  themselves  to  be  honest,  who 
are  in  that  position.  They  will  not  do,  for  they  are  not  good 
business  men. 

It  must  never  be  forgotten  that  when  previously  good  men 
go  wrong  it  is  almost  invariably  under  the  pressure  of  indebt- 
edness improvidently  incurred.  There  may  be  instances  of 
men  of  good  reputation,  and  free  from  debt,  who  violated 
trusts,  but  I  have  never  heard  of  them.  Those  wlio  go  wrong 
are  those  who  live  beyond  their  means.  I  do  not  speak  of 
gambling,  hard  drinking,  betting,  or  stock  speculation,  because 


248  THE    FARMER    AS    A    COOPERATOR. 

I  assume  that  men  with  those  habits  would  not  be  considered. 
I  have  often  thought  that  honesty  is  in  the  nature  of  a  luxury 
which  most  men  desire;  those  who  fall  are  invariably  those  of 
infirm  will  wlio  permit  extravagance — and  sometimes  confi- 
dence in  others — to  beget  indebtedness,  under  whose  pressure 
they  come  to  think  they  can  not  afford  the  luxury  of 
honesty. 

Ahiliti/. — Business  ability  consists  more  than  anything  else 
in  the  accurate  knowledge  and  classification  of  facts  relating 
to  the  business.  Judgment  is  the  most  common  of  business 
qualities;  you  can  find  it  anywhere.  I  make  this  ap[)arently 
paradoxical  statement  purposely  to  emphasize  the  fact  that 
what  we  call  the  poor  judgment  by  which  the  majori«ty  of  men 
are  unquestionably  swayed  is  simply  insufficient  knowledge. 
When  men  of  identical  interests  differ  it  is  because  one 
believes  something  to  be  true  which  the  other  disputes  or 
has  not  thought  of.  Of  course  vigor  is  essential  to  success, 
but  I  am  now  speaking  of  intellectual  qualities.  But  the 
possession  of  accurate  knowledge  is  almost  complete  evidence 
of  vigor,  because  accurate  knowledge  is  only  attained  by 
industry,  and  there  can  be  no  industry  without  vigor.  The 
man  who  accepts  a  casual  newspaper  paragraph,  or  any  unau- 
thenticated  statement  of  a  fact  essential  to  his  business,  may 
seem  to  have  knowledge,  and  yet  may  be  w^orse  than  ignorant. 
If  he  does  not  think  he  knows,  he  will  probably  seek  to  ascer- 
tain before  acting,  but  if  he  acts  on  inaccurate  information  he 
invites  disaster.  The  man  of  ability  therefore  will  know 
things  definitely,  either  of  his  own  knowledge  or  from  tlie 
definite  authenticated  statement  of  one  who  does  know  and 
who  is  worthy  of  trust. 

The  larger  and  more  important  the  business  the  larger  the 
number  of  facts  it  is  necessary  to  know  definitely  in  order  to 
conduct  it  successfully.  For  example,  tFie  manager  of  a 
cooperative  dried  fruit  marketing  society  should  know  all  the 
facts  relating  to  the  following  matters:  Varieties  of  dried 
fruits,  tlieir  modes  of  prei)aration  and  packing  in  all  produc- 
ing districts;  cost  of  production  and  transportation  in  all 
districts,  that  he  may  estimate  the  probable  strength  of  com- 


>[axa(;ement  of  oooperative  sopiettes.  249 

petition;  the  quality  of  his  own  and  competing  goods;  usual 
annual  world's  consumption  at  a  given  price;  ratio  of  increase 
of  consumption  upon  reduction  of  price;  financial  condition 
of  his  own  and  competing  people,  and  of  consumers;  stocks 
on  hand  in  consuming  districts;  names  of  wholesale  purchas- 
ers; names,  standing,  and  connection  of  brokers;  character  and 
disposition  of  his  directors  and  stockholders;  and  many  other 
matters.  It  is  the  same  with  any  other  business:  the  manager 
needs  to  know  accurately  and  in  detail  all  the  facts  bearing 
on  that  business;  when  all  the  facts  are  known,  the  proper 
policy  will  be  apparent  to  all.  I  have  seen  many  meetings  of 
directors  and  stockholders,  and  when  facts  have  been  once 
settled,  there  has  invariably  been  unanimity  in  opinion  as  to 
policy.  It  is  needless  to  say  that  no  manager  can  be  expected 
to  know  all  that  a  manager  should  know  as  to  the  business 
committed  to  him,  but  the  nearer  he  approaches  to  j)erfect 
knowledge,  the  more  useful  he  will  be. 

Right  here  is  a  point  at  which  cooperative  business  will 
always  be  at  a  disadvantage  as  compared  witii  competitive 
business.  The  owner  of  a  competitive  business  will  usually 
be  a  person  who  by  long  experience  has  become  a  master  of 
the  business,  and  by  natural  selection  has  proved  his  vigor; 
if  he  has  occasion  to  employ  a  person  for  a  responsible  position, 
he  is  an  excellent  judge  of  his  qualiiications  since  he  will 
almost  certainly  be  the  better  informed;  and  his  personal 
interests  will  lead  him  to  the  utmost  care  in  selection.  In 
cooperative  business,  on  the  contrary,  the  proposed  manager, 
at  least  in  the  beginning,  will  almost  certainly  need  to  know 
more  than  any  of  his  employers,  and  how  shall  they  who  have 
not  the  qualifications,  sit  in  judgment  on  one  who  knows  more 
than  they?  They  can  only  do  it  as  they  select  their  doctor  or 
their  lawyer,  by  their  general  judgment  of  the  man,  except — 
and  it  is  a  very  important  exception — tliat  they  have  the 
opportunity  to  ask  the  policy  of  the  proposed  manager,  and 
his  reasons  for  that  policy,  in  the  course  of  his  explanation  ol 
which  the  extent  of  his  knowledge  will  appear.  A  man  who 
has  no  definite  policy  to  propose,  or  who  is  unable  to  state 
clearly,  with  the  authority  given,  his  reason  for  that  policy, 


250  THE    FARMER    AS    A    COOI'ERATOR. 

is  unfit  for  manager.  When  lie  gives  his  reasons  he^must 
state  facts,  and  those  facts  can  be  verified  by  the  directors,  and 
upon  the  accuracy  of  liis  knowledge  a  fair  judgment  of  his 
abihty  may  be  based. 

Vigor. — Extent  of  accurate  knowledge,  as  already  stated, 
will  usually  indicate  vigor,  but  vigor  is  of  two  kinds,  one  aris- 
ing from  an  active  nervous  tem[)erament,  involving  quick 
perception  and  rapid  execution,  and  not  un frequently  associ- 
ated with  a  weak  stomach— from  which  all  liuman  power  comes 
— and  a  tendency  to  wear  out  and  break  down;  the  other  the 
outgrowth  of  a  more  sluggish  nature,  witli  slower  jDcrception 
and  more  deliberate  execution,  but  accompanied  by  noble 
digestive  organs  and  wonderful  staying  qualities.  This  type 
is  by  far  the  most  valuable,  but  is  seldom  available  in  middle 
life  for  salaried  positions.  It  is  tlie  class  which  grows  rich 
and  is  occupied  with  its  own  property.  The  physique  and 
conversation  of  the  man  indicates  the  quality  of  his  vigor. 

Experience  and  Tad. — Experience,  of  course,  is  only  to  be 
ascertained  by  inquiry,  but  there  is  something  to  be  said 
about  tact.  This  almost  indefinable  quality  may  be  the  result 
of  the  natural  promi)ting  of  a  kind  and  honest  heart,  or  it 
may  be  the  studied  expression  of  a  cold  and  calculating 
villain;  one  of  the  most  tactful  and  winning  men  I  ever  met 
was  also  one  of  the  greatest  scoundrels.  Intimate  acquaint- 
ance will  disclose  the  type,  but  casual  or  limited  acquaintance 
will  not  always  do  so.  Tact  is  essential  in  cooperative  busi- 
ness in  order  to  keep  it  together;  its  presence  may  usually  be 
determined  by  the  effect  of  the  person  on  one's  self;  to  the  extent 
that  he  wins  you  to  him  he  has  tact,  and,  if  the  opportunity 
occurs  to  observe  him  in  a  ditficult  or  annoying  position,  the 
impression  tliat  ho  makes  upon  yourself  under  the  circum- 
stances is  the  best  evidence  you  can  have  of  his  tact.  Your 
opinion  of  the  source  of  his  tact  will  be  determined  by  your 
investigation  as  to  his  integrity. 

The  Valve  of  Salaried  Service. — I  know  of  nothing  more 
puzzling  to  the  directors  of  a  farmers'  distributing  society 
proposing  to  do  business  on  a  large  scale  than  fixing  a  com- 
pensation of  its  principal  ofiicers.     They  often  have  not  the 


MANAGEMEXT    OF    COOPERATIVE    SOClETIE.s.  251 

means  of  judging  either  of  the  value  of  the  desired  service  to 
themselves,  the  cost  of  it  to  the  individual,  or  its  value  in"  the 
competitive  market.  It  is,  of  course,  inij)ossihle  to  la\'  down, 
in  a  scientific  way,  definite  rules  wherehy  the  value  of  any 
given  personal  service  maybe  determined,  but  something  may 
be  said  which  will  assist  stockholders  in  forming  just  views  of 
this  subject. 

The  one  thing  which  should  have  and  necessarily  must 
have  most  consideration  in  determining  the  value  of  personal 
service  is  the  number  of  facts  which  must  be  accurately 
known  in  order  to  properly  perform  the  service.  The  Brook 
Farm  enthusiasts,  in  the  ideal  community  which  they  estab- 
lished a  half  a  century  since,  laid  down  the  fundamental 
principle  that  all  labor  should  be  paid  at  a  uniform  rate, 
regardless  of  its  nature;  with  the  idea,  of  course,  that  the  more 
disagreeable  occupations  should  be  shared  in  turn  by  all;  and 
in  fact,  for  a  time,  the  head  of  the  community,  the  accom- 
plished Dr.  Ripley,  received  the  same  price  per  hour,  whether 
serving  as  an  instructor  in  psychology,  or  as  chambermaid  to 
the  cows;  but  in  due  time  it  was  discovered  that,  while  almost 
any  of  the  community  could  satisfactorily  replace  tlie  good 
doctor  in  the  malodorous  functions  of  the  stable,  his  duties  as 
instructor  could  not  be  so  well  performed  by  any  other.  It 
also  doubtless  occurred  to  them,  in  due  time,  that  while  a 
moment's  observation  was  sufficient  preparation  for  the  one 
service,  ability  in  the  other  could  only  be  acquired  at  the 
price  of  years  of  not  immediately  remunerative  labor.  At  any 
rate,  they  abandoned  the  system,  and  so  long  as  preparation 
for  special  work  has  to  be  made  at  the  expense  of  the  indi- 
vidual, he  must  receive  the  increased  value  of  the  service 
prepared  for. 

A  common  laborer  needs  to  know  few  points,  and  earns  a 
dollar  a  day;  the  skilled  workman  must  know  more,  and 
earns  $3.00  a  day;  the  foreman  must  know  still  more,  and 
earns  $-i.00  per  day;  the  superintendent,  who  must  have  a  far 
wider  knowledge,  earns  according  to  the  extent  and  impor- 
tance of  his  business;  and,  in  general,  the  compensation  of 
personal  service  increases  in  a  direct  ratio  with  the  extent 


252  THE    FARMER    AS    A    COOPERATOR. 

of  the  accurate  knowledge  required  for  the  proper  discharge 
of  its  duties;  the  number  of  facts  necessary  to  be  known  by 
the  traffic  manager  of  a  great  railway  system  is  beyond  calcula- 
tion; very  few  men  possess  the  acuteness,  tireless  industry,  and 
physical  endurance,  combined  with  the  opportunity,  to  acquire 
them;  in  like  manner,  the  men  who  have  charge  of  the  invest- 
ments of  the  enormous  accumulations  and  business  of  the 
great  banking  and  insurance  companies  must  know  all  the 
facts  affecting  the  prosperity  of  almost  every  business,  and 
keep  constantly  advised  of  changing  conditions;  consequently, 
positions  like  these  command  the  largest  salaries  paid  in  the 
world. 

But  it  must  be  remembered  that  it  is  information  bearing 
specially  on  the  subject  to  be  dealt  with,  which  has  commer- 
cial value.  The  foren)an  of  a  creamery  may  be  an  accom- 
plished astronomer,  and  yet  be  able  to  make  no  better  butter. 
I  suppose  no  man  ever  lived  who  knew  accurately  more  facts 
than  Charles  Darwin,  or  had  greater  power  of  classifying  them, 
and  reasoning  from  them,  but  I  do  not  imagine  that  the  infor- 
mation of  the  author  of  the  ''Origin  of  Species"  had  any  great 
commercial  value,  and  it  is  with  commercial  affairs  that  busi- 
ness organizations  have  to  deal. 

Of  course,  many  considerations  besides  possession  of  knowl- 
edge affect  the  value  of  personal  service,  such  as  vigor,  tact, 
integrity,  and  so  on;  but  I  think  knowledge  the  great  factor, 
because  knowledge  is  the  exponent  of  labor  expended  in 
preparation,  and  of  industry;  other  qualifications  are  the  gift 
of  nature,  and  nature  is  bountiful.  One  can  find  natural 
qualifications  anywhere;  a  navvy  on  the  embankment  may  be 
more  vigorous  than  the  president  who  directs  his  labor  from 
his  luxurious  office. 

Reflections  of  this  kind  will  materially  aid  in  forming  fair 
estimates  of  the  value  of  personal  service  in  any  ca})acity, 
whenever  the  (■nii)]oyer  himself  knows  what  quahfications  he 
requires.  AVitli  the  average  wage  of  the  unskilled  laborer  as 
the  starting-point,  and  some  inquiry  as  to  tlie  usual  compen- 
sation of  the  quality  of  service  desired  in  competitive  business, 
and  of  the  expenses  necessary  to  sustain  the  employee  with 


maxa(;kn[I':n't  ok  coupkrativI':  sijcikties.  253 

reasonable  comfort  among  the  people  with  whom  he  will  nec- 
essarily associate,  a  fair  idea  of  the  commercial  value  of  the 
desired  service  inay  be  obtained.  If  tlie  location  is  in  a  city 
or  large  town,  the  total  ex})onse  of  an  ordinary  family  will 
usually  be  about  five  times  the  rent  of  a  house  suitable  for 
their  occupation.  Any  income  above  that  can  usually  be 
laid  by. 

These  considerations  are  useful  as  aiding  to  determine  what 
a  coo[)erative  society  can  afford  to  pay  for  certain  service.  As 
a  matter  of  fact,  however,  the  society  will  and  should,  like  com- 
petitive employers,  pay  not  what  it  can  aflor<l  to  pay,  but  what 
it  can  get  the  necessary  work  done  for.  And  this  will  be  deter- 
mined by  the  same  influences  which  fix  the  prices  of  other 
commodities  in  the  competitive  market.  So  long  as  coopera- 
tion is  competing  with  individualism,  its  dealings  with  all 
outside  its  own  organism  must  be  competitive. 

If  there  is  in  the  market  a  scarcity  or  excess  of  persons 
possessing  the  necessary  qualifications,  that  will,  of  course, 
correspondingly  atfect  the  market  value  of  their  services;  but 
assuming,  as  is  doubtless  correct,  that  there  is  no  lack  of 
natural  ability,  the  cost  of  acquiring  and  maintaining  the 
necessary  qualifications  will  determine  the  limit  below  which 
compensation  can  not  be  reduced  witliout  impairing  efficiency. 
The  cost  of  acquiring  the  qualifications  can  be  fairly  well 
estimated  in  the  light  of  what  has  been  said.  Tiie  cost  of 
maintaining  them  is  not  likely  to  be  fairly  estimated  as  to 
the  most  important  concerns,  having  their  operating  centers 
in  large  cities,  by  persons  accustomed  only  to  country  life. 
Those  intrusted  with  important  interests  must  mingle  with 
those  in  charge  of  similar  interests,  and  who,  in  competitive 
business,  will  be  paid  either  by  salary  or  by  profits,  in  accord- 
ance with  their  responsibility.  These  business  associations 
will  lead  to  certain  social  relations,  all  of  which  involves  a 
certain  expense.  The  cubic  feet  of  living  space,  and  the  sun- 
light, without  which  no  farmer  would  consider  himself  com- 
fortable, will  cost,  in  a  large  city,  more  than  the  net  income 
of  most  small  farms.  The  reasonable  recreations,  and  social 
enjoyments,  which,  in  the  country,  cost  little  or  nothing,  are  a 


254  THE    FARMER    AS    A    COOPERATOK. 

constant  source  of  small  expenditures,  and  the  items  of  dress, 
fuel,  and  other  necessary  living  expenses,  mount  to  totals 
which  would  surprise  farmers. 

Now  in  a  modest  way  the  principal  employees  of  coopera- 
tive societies  must  be  able  to  enjoy  reasonably  what  are  con- 
sidered to  be  the  necessary  comforts  of  life  by  the  class  among 
whom  they  should  mingle,  or  they  will  cease  to  associate  with 
that  class;  their  general  knowledge  of  affairs  and  their  touch 
with  them  will  become  impaired,  and  their  usefulness  lessened. 
If  they  are  able  men  they  are  likely  to  abandon  cooperation  for 
the  greater  [»rizes  of  competition  and  the  society  will  incur  the 
expense  of  constantly  breaking  in  new  men  and  paying  for 
their  mistakes.  There  will  be  discontent  among  tiie  employees 
and  their  families,  and  strong  temptations  to  dishonorable 
means  of  increasing  their  income.  By  some  of  these  methods, 
any  attempt  of  cooperation  to  reduce  the  salaries  of  employees 
below  cost  of  acquiring  and  maintaining  the  necessary  stan- 
dard of  efficiency,  will  certainly  lead  to  trouble.  If  the 
employee  is  able  he  will  not  permit  himself  to  suffer;  if  he 
lacks  ability  he  is  unfit  for  responsible  service.  Gratuitous  or 
half-paid  service  of  able  men  can  be  counted  on  but  for  a 
short  time.  They  will  soon  tire  of  it  and  refuse  to  serve.  At 
the  same  time  it  is  unnecessary  to  say  that  all  these  matters 
should  be  settled  in  the  light  of  common  sense,  and  conserva- 
tism, and  with  no  tendency  whatever  to  extravagance  or 
foolishness.  The  employees  of  a  cooperative  society  can 
never  expect  to  receive  the  financial  reward  open  to  the  high 
grades  of  ability  in  competitive  business.  A  large  part  of  the 
compensation  received  by  the  managers  of  important  coopera- 
tive societies  must  be  in  the  respect  and  esteem  of  the  com- 
munity. This  respect  and  esteem,  when  assured,  have  a  com- 
mercial value  of  which  the  society  may  avail  itself.  It  is 
doubtful  if  there  is  a  lawyer  in  the  country  who  would  refuse 
an  appointment  to  the  bench  of  the  Supreme  Court  of  the 
United  States,  although  the  salary  is  far  less  than  those  fitted 
for  it  can  earn  in  private  practice;  but  the  honor  attached  to 
it  is  immense,  and  this  consideration  suffices  to  })rocure  for  the 
service  the  highest   ability  which  the  country  affords.      The 


^rAN.\(;i;.\iKNT  oi-'  cooi'KRATivk  societies.  2.JO 

same  principle  ai)[)lies  to  the  smaller  affairs  of  life.  If  fidelity 
and  ability  in  im|)ortant  })Ositi()ns  in  cooperative  business  are 
assured  of  the  reward  of  public  approbation,  and  the  tenure  of 
position  made  as  secure  as  that  customary  iu  private  business, 
a  high  gi'ade  of  ability  can  be  retained  at  a  cost  far  less  than 
competitive  business  will  pay  for  it;  but  if  such  positions  are 
permitted  to  become  the  reward  of  intrigue,  and  the  incum- 
bents subjected  to  suspicion  and  distrust,  and  no  permanence 
of  position  opening  the  way  to  a  career  is  assured,  bright  men 
will  be  driven  from  the  service,  the  costly  experience  of  paying 
for  the  mistakes  of  new  men  will  follow,  and  cooperation  will 
not  be  so  well  served  as  competition. 

Infiuences  to  be  Guarded  Against. — Economists  fear  that  coop- 
eration on  any  extensive  scale  will  be  wrecked  on  the  rocks 
of  selfishness  and  jealousy.  They  expect  their  first  manifesta- 
tion to  appear  in  insufficient  provision  for  the  salaried  staff, 
coupled  with  such  grumbling  and  fault-finding,  if  no  worse, 
us  will  tend  to  drive  capable  men  out  of  cooperation  and  into 
competition.  They  fear  that  while,  at  the  beginning,  able 
men,  under  the  influence  of  a  generous  enthusiasm,  may  give 
bountiful  service  either  freely  or  for  less  than  its  market 
value,  they  will  soon  tire  of  it,  or  will  die  and  leave  no  suc- 
cessors, and  that  the  management  will  drift  into  incompetence. 
This  is  predicted  by  those  opjDosed  to  cooperation. 

As  good  management  is  essential  to  success,  and  as  there 
is  at  present  greater  personal  advantage  to  men  of  ability  in 
competitive  than  in  cooperative  service,  it  is  necessary  that 
important  positions  in  cooperative  service  be  made  to  approach 
the  comfort  of  similar  positions  in  competitive  service,  in 
security  of  tenure,  and  in  general  respect.  As  it  stands  now, 
uo  man  can  engage  in  cooperative  service  without  falling  in 
ihe  esteem  of  many  having  important  favors  to  bestow;  they 
vvill  distrust  either  his  ability  or  his  honesty,  because  com- 
petitive service  being  obviously  the  most  desirable,  men  will 
be  slow  to  believe  that  one  having  the  ability  to  succeed  in 
competitive  life  should  for  any  good  purpose  engage  in  cooper- 
ation. The  influences  of  stinginess  and  suspicion  should 
therefore  be  avoided. 


256  THE    FARMER    AS    A    L'OOFERATOR. 

Tlie  influence  of  sentiment  can  never  be  relied  upon ; 
wliatever  tlie  race  may  sometime  become,  it  can  not  now  be 
governed,  in  business  ati'airs,  by  anytliing  but  selfishness — 
not,  of  course,  using  the  term  in  its  offensive  sense,  but  mean- 
ing the  general  desire  of  personal  advantage.  Many  very 
estimable  persons  expect  successful  cooperation  based  on  the 
idea  of  brotherhood.  This,  when  analyzed,  is  found  to  mean 
that  a  few  persons  should  do  the  necessary  work  of  a 
community  for  nothing,  or  for  less  personal  advantage  than 
competitive  business  would  afford.  This  analysis  may  not 
be  at  first  apparent  to  some,  but  it  is  exactly  what  "brother- 
hood "  in  business  affairs  means.  The  influence  is  dangerous, 
for  the  business  will  not  long  be  done  except  for  full  payment 
in  money,  as  far  as  the  necessity  of  the  individual  requires, 
and  the  remainder  in  honor,  which  has,  as  already  stated,  a 
market  value  in  a  good  sense,  as  well  as  a  bad  one.  Coopera- 
tion based  largely  on  sentiment  will  fail.* 

There  will  invariably  be  more  or  less  intriguing  for  place 
and  power  in  important  cooperative  enterprises,  just  as  there 
is  in  political  affairs,  and  precisely  of  the  same  character.  In 
one  cooperative  society  of  large  membership  to  which  I  belong, 
I  note  at  each  annual  meeting  the  effort  of  tradesmen  com- 
peting for  its  business  to  influence  the  choice  of  directors  who 
may  be  favorable  to  one  or  the  other  party,  and  to  dis])lace 
those  in  the  management  whom  the  interfering  parties  deem 
undesirable,  and  I  sometimes  see  those  efforts  in  a  measure 
successful.     It  must  be  expected  and  guarded  against. 

In  general  all  influences  must  be  considered  which  can  be 
supposed  to  have  effect  upon  men  in  charge  of  large  interests 
in  which,  as  individuals,  their  share  is  small,  and  who  receive 
little  or  no  compensation  for  their  service.  Adequate  com- 
pensation either  to  directors  or  management  is  the  most 
certain  insurance  of  faithful  service.  Directors  usually 
should  not  be  paid  in  money,  but  they  may  be  well  paid  in 
the  esteem  and  loyalty  of  their  associates. 

*  Incidentally  it  may  be  said  that  a  cdminunity  whicli  will  on  the  pretense 
of  "brotherhood"  accept  continuous  fj;ratuitous  or  insufficiently-paid  service 
ill  business  proHtable  to  the  couiiaunity,  is  as  despicable  as  any  other  mendi- 
cant. 


CHAPTER    yU. 

THE    ECONOMIC    GAIN    OF    COOPERATION. 

IT  is  doubtless  true  that  the  popular  imagination  exaggerates 
the  possible  economic  gain  of  cooperation.  The  reasoning 
in  regard  to  this  and  all  other  socialistic  and  semi -socialistic 
problems  assumes  certain  conditions  in  the  nature  of  mankind 
which  do  not  exist.  It  is  assumed  either  (a)  that  mankind  is 
moved  by  a  desire  for  the  general  good,  or  (b)  that  by  legal 
enactment  men  can  be  made  to  act  as  if  they  were  so  moved; 
while,  as  a  matter  of  fact,  (a)  mankind  is  moved  by  the  desire 
of  personal  advantage,  and  (b)  no  legal  enactment  can  produce 
any  other  condition. 

I  have  no  occasion  here  to  consider  the  effect  of  this  under- 
mining of  premises  upon  the  doctrines  of  ])ure  socialism, 
which  have  been  expounded  with  clear  and  perhaps  unassail- 
able logic  if  all  the  premises  are  accepted,  but  all  reasoners 
are  aware  of  the  fatal  effect  upon  logical  edifices  of  any  inse- 
curity in  the  premised  foundations.  Illustrations  occur  every- 
where. For  example,  all  engineers  know  that  but  for  one 
thing  hot  air  is  a  far  more  economical  and  safer  source  of 
power  than  steam,  and  one  of  our  greatest  engineers,  in 
ignorance  of  tliat  one  thing,  devoted  years  of  his  life,  and 
several  fortunes,  to  the  construction  of  hot-air  engines;  the 
one  fatal  defect,  whicli  experiment  only  could  demonstrate, 
was  the  fact  that  under  the  high  rate  of  temperature  necessary, 
the  working  parts  of  the  engine  could  not  be  constructed  of 
iron  and  operated  profitably,  if  at  all.  Hot-air  engines  of  high 
power  are  tiierefore  impossible  until  science  shall  disclose  some 
new  methods  of  dealing  with  iron,  or  the  use  of  some  other 
metal  becomes  economically  possible.  In  like  manner  I  am 
sure  that  those  who  have  liad  most  experience  in  concrete  deal- 
ings with  mankind  in  business  affairs  will  agree  that  many 
plans  of  social  reform  which  seem  perfectly  feasible  to  many 
17  (257) 


258  THE    FARMER    AS    A    COOPERATOR. 

earnest  enthusiasts  will  be  found  practically  unworkable  until 
social  evolution  has  wrought  decided  changes  in  human  nature. 

And  yet  I  am  convinced  that,  after  making  all  allowances, 
there  is  a  residuum  of  economic  gain  in  cooperation  quite 
sufficient  to  justify  its  application  in  many  cases,  and  it  also 
seems  to  me  certain  that  as  years  go  on  tlie  tendency  to 
cooperation  will  increase,  as  the  art  of  practicing  it  becomes 
better  understood,  and  that  it  will  become  economically  gain- 
ful over  a  gradually-increasing  area  of  usefulness,  all  of  which 
will  be  simply  a  manifestation  of  a  social  evolution  which  is 
leading  us  we  know  not  where. 

Promoters  of  cooperation  commonly  err  not  only  in  over- 
estimating the  present  cooperative  power  of  human  nature, 
but  also  in  overestimating  the  profits  of  competitive  business. 
Having  constantly  before  them  the  few  great  fortunes  which 
have  been  the  reward  of  exceptional  ability,  they  forget  the 
innumerable  instances  of  failure  which  investigation  would 
disclose.  The  so-called  Bonanza  mines  of  Nevada  yielded 
great  fortunes  to  a  few  men,  but  it  is  doubtless  true  that  more 
money  has  been  expended  in  the  district  around  Mount 
Davidson  than  was  ever  taken  out  of  it.  It  would  not  be  diffi- 
cult with  sufficient  study  to  make  a  fair  estimate  of  the  aver- 
age profits  of  competitive  business,  and  it  has  probably  been 
done,  although  I  have  not  met  with  it,  but  it  is  unquestionably 
true  that  cooperation  offers  no  such  possible  field  of  economic 
gain  as  the  popular  mind  pictures  to  itself.  I  have  known 
enormous  gains  to  cooperative  societies  in  single  seasons,  as 
compared  with  the  returns  which  competitive  methods  would 
have  brought  to  the  members,  and  I  have  known  of  small 
losses  in  other  seasons ;  but  it  must  be  remembered  that  in  the 
long  run  cooperation  will  have  to  deal  with  average  conditions, 
and  it  will  tend  to  solidity  and  permanence  if  tliose  engaging 
in  cooperation  do  not  do  so  with  expectations  that  can  not  be 
realized.  It  must  never  be  forgotten  that  exceptional  fortunes 
gained  in  comi)etitive  business  are  invariably  the  result  of 
exceptional  ability  joined  to  the  accumulating  instinct,  and 
that  cooperation  offers  no  inducement  to  those  capable  of  such 
accumulations  to  engage  in  its  service,  or  if  in  it,  to  devote  to 


Till':    ECONOMIC    (iAIX    OF    COOPERATION.  2o*J 

it  tliat  streiuious  effort  vvliicb  alone  can  produce  such  results. 

To  illustrate  the  economic  gain  of  cooperation  let  us  suppose 
a  problem  which  exhibits  substantially  an  actual  case.  Sup- 
pose a  product  of  twenty  thousand  car-loads  of  fruit  produced 
by  perhaps  twenty-five  thousand  individuals  in  California 
to  be  distributed  to  the  tables  of  say  one  million  consumers 
living  at  an  average  distance  of  two  thousand  five  hundred 
miles  from  the  place  of  production.  Let  us  eliminate  from  the 
problem  the  question  of  transportation,  as  not  concerned  with 
the  aspect  of  cooperation  which  we  are  considering,  and 
endeavor  to  ascertain  what  persons  not  connected  with  trans- 
portation are  neces.sarily  concerned  in  tliis  distribution,  their 
proper  and  actual  compensation,  and  at  what  points  and  to 
what  extent  any  saving  can  be  effected  by  cooperative 
methods,  whether  to  the  consumer  or  producer. 

Of  the  above  volume  of  fruit,  part  would  go  forward  in  a 
fresh  state,  part  dried,  and  part  canned  or  otherwise  specially 
prepared.  As  these  different  forms  of  the  product  do  not  all 
follow  the  same  channels,  we  shall  best  avoid  confusion  by 
selecting  some  one  form,  preferably  dried  fruits,  whose  distri- 
bution is  widest,  and  in  which  the  methods  employed  are  the 
simplest.  The  study  of  this  example  will  indicate  the  method 
which  any  one  familiar  with  the  facts  may  apply  to  any 
other  industry. 

A  consumer  desiring  dried  fruit  will  apply  to  his  family 
grocer.  Living,  as  I  do,  in  a  fruit-producing  district,  if  I 
needed  some  variety  which  I  do  not  myself  produce,  I  should 
order  of  my  grocer  rather  than  to  spend  the  time  necessary  to 
effect  the  slight  saving  which  could  be  made  by  hunting 
among  my  neighbors  till  I  found  it.  Much  more  would  one 
living  where  the  article  is  not  produced  find  the  help  of  liis 
grocer  essential.  It  is  self-evident  that  the  consumer  can  not 
buy  direct  from  the  distant  producer,  and  that  the  retailer,  at 
least,  is  a  necessary  middleman,  performing  an  economic 
function  of  certain  value,  and  who  can  not  be  dispensed  with. 

It  may,  however,  and  often  does  happen  that  the  retailer 
exacts  a  price  for  his  necessary  service  in  the  way  of  sucli  an 
excessive  profit  as  tends  to  check  consumption,  and  thereby 


260  THE    PARMER    AS    A    COOPERATOR. 

injures  the  producer  by  restricting  his  market.  As  a  matter 
of  fact,  this  condition  does  obtain  as  to  many  products,  and 
in  California  it  is  a  subject  of  continual  complaint  among 
producers. 

The  question  is,  By  what  means,  if  any,  can  cooperative 
associations  of  producers  control  the  retail  distributive  agencies 
as  to  prices  charged  to  consumers?*  This  can  be  best  under- 
stood by  a  brief  exposition  of  the  customary  profits  of  retailers. 
The  expenses  of  conducting  a  retail  business  probably  range 
from  ten  to  fifteen  per  cent  of  the  gross  amount  of  business 
done;  the  profits  range  from  five  per  cent  or  less  on  such 
sta])les  as  sugar  and  flour,  to  fifty  per  cent  and  even  more  on 
certain  lines  of  fancy  groceries.  I  have  before  me  a  retail 
catalogue  which  gives  a  rate  of  twenty-five  cents  per  pound 
on  some  imported  goods  which,  I  happen  to  know,  can  be 
delivered  in  moderate  lots  at  twelve  and  a  half  cents;  there 
are  doubtless  many  articles  on  the  list  with  whose  cost  I  am 
not  acquainted,  which  yield  an  equal  profit.  In  the  ratio  in 
which  any  article  approaches  the  list  of  "staple"  goods,  in 
large  demand,  and  of  general  sale,  the  retailer's  profit  tends 
to  grow  less.  The  average  profit,  of  course,  must  exceed  the 
cost  of  doing  business,  or  the  business  must  cease;  every  hun- 
dred dollars'  worth  of  goods  sold  at  less  than  the  cost  of  doing 
business  must  be  offset  by  an  equal  amount  sold  at  an  equal 
rate  above  such  cost. 

From  the  above  it  is  evident  that,  in  so  far  as  any  product 
can  be  brought  into  general  demand,  the  retail  profits  tend  to 
lessen,  which  in  turn  helps  to  extend  the  market.  A  very 
desirable  product  wili,  in  the  course  of  time,  work  its  own  way 
into  consumption,  as  people  learn  about  it  from  one  another, 
and   no  undesirable  product,  however   strongly  })ushed,  can 


*  It  is  evident  that  this  field,  so  far  as  it  is  covered  by  cooperation,  properly 
belongs  to  cooperative  societies  of  consumers,  united  to  purchase  supplies.  This 
subject  I  do  not  wish  to  enter  upon.  It  is  evident,  moreover,  that  any  coopera- 
tive society  of  consumers  is  likely  to  be  organized  to  escape  high  retail  price.* 
of  any  single  product.  If  a  cooperative  "store  "  is  started,  it  will  be  to  secure 
lower  prices  on  all  ordinary  supplies.  I  confine  this  discussion  in  the  text  to 
cooperative  methods  of  selling. 


THE    ECONO^riC    fwVIN    OF    COOPERATION.  261 

have  a  permanent  sale.  But  any  product  can  be  pushed  into 
sale  far  more  rapidly  by  judicious  advertising,  and  the  better 
the  article,  the  more  certain  the  profit  in  advertising.  And 
advertising  is  any  means  whereby  public  attention  is  called 
to  the  product,  whether  by  newspapers,  circulars,  expositions, 
public  lectures,  or  any  of  the  hundred  forms  whereby  man- 
kind is  informed  of  what  was  before  unknown.  It  is  in  this 
way  that  the  thousand  proprietary  articles  with  which  we  are 
all  familiar  have  been  brought  to  our  attention. 

The  special  "advertising"  of  any  product  must  invariably 
be  done  at  the  expense  of  the  original  producer,  or  not  at  all. 
No  "  middleman  "  of  any  kind  will  spend  any  money  in  this 
way,  unless  casually,  in  connection  with  some  private  "brand" 
of  his  own.  Neither  can  any  individual,  or  small  group  of 
individuals,  afford,  at  their  private  cost,  to  do  any  important 
work  of  this  kind,  whose  benefits  are  shared  by  everybody  in 
the  business.  Of  course  the  individual  efforts  of  thousands  of 
producers  to  sell  their  product,  constitute,  in  the  aggregate,  a 
large  amount  of  advertising,  but  this  is  simply  the  normal 
"pushing"  which  all  products  must  obtain  to  find  any  sale. 
To  rapidly  introduce  a  new  product,  or  one  whose  production  is 
increasing  faster  than  the  consumi)tion,  an  extra  and  systematic 
effort  is  required. 

At  this  point,  therefore,  there  is  a  distinct  economic  gain 
possible  through  cooperation,  by  enabling  producers  to  unite 
for  the  purpose  of  advertising  their  product,  pushing  its  sales 
vigorously,  and  finding  and  opening  new  markets* 

There  are,  of  course,  special  methods  of  increasing  markets 
by  forcing  lower  retail  prices,  which  cooperative  societies  may 
use,  but  they  are   hardly  possible,  or  at   least   desirable,  for 


*  Incidentally  we  may  here  note  a  dift'erence  between  cooperation  and 
socialism.  The  income  of  the  average  individual  being  fi.xed,  all  producers 
are  struggling  with  each  other  to  get  the  largest  share  of  it.  By  as  much  as 
one's  outlay  is  increased  in  one  direction,  it  must  be  diminished  in  some  other. 
Distributive  cooperation  of  producers  is  the  organization  of  one  class  for  the 
purpose  of  more  effectually  competing  with  all  other  classes  in  the  strife  for  a 
larger  share  of  the  purchasing  fund.  Socialism  contemplates  the  abolition  of 
all  competition.     It  is  best  to  keep  in  mind  those  distinctions. 


262  THK    FARMER    AS    A    COOPER ATOR. 

general  use.  By  advertisements  in  papers  of  general  circula- 
tion, the  public  may  be  inforjned  of  the  actual  cost  of  the 
product,  in  whicli  case  public  opinion  would  cause  a  reduc- 
tion of  profits;  or  consignments  may  be  made  to  enterprising 
retailers  upon  condition  that  the  goods  should  be  sold  at  fixed 
prices  for  a  given  time.  Either  of  these  remedies,  however, 
would  excite  the  bitter  enmity  of  retailers,  leading  to  strong 
efforts  on  their  part  to  discourage  sales  and  introduce  compet- 
ing goods.  There  is  no  economic  gain  in  beginning  a  fight 
where  all  the  odds  are  against  the  attacking  party,  as  they 
would  be  in  this  case,  but  I  often  hear  such  methods  pro- 
posed. I  can  conceive  of  them  as  proper  only  in  some  very 
exceptional  case. 

The  retail  merchant  most  conveniently  obtains  his  supplies 
from  wholesale  merchants  in  the  same  line.  In  the  case  which 
we  are  considering,  for  illustration,  the  retail  grocer  would  get 
his  Californian-dried  fruits  from  his  wholesale  grocer.  It  is  the 
most  poj)ular  of  delusions  to  imagine  that  manufacturers  or 
associations  of  producers  can  profitably  ignore  the  wholesale 
merchant,  and  sell  direct  to  retailers.  In  the  case  of  California 
merchandise  seeking  eastern  markets,  this  would  evidently 
be  impossible,  except  by  establishing  depots  in  the  leading 
wholesale  centers,  since  the  difference  in  freights,  on  so  long 
a  distance,  between  car-load  and  less  than  car-load  lots,  is,  and 
is  always  likely  to  be,  more  than  the  wholesale  merchant's 
profit.  This  distribution  to  retailers  is  a  measure  very  rarely 
attempted  by  any  competitive  manufacturer  or  producei  and 
})robably  never,  except  for  urgent  and  special  competitive 
reasons.  I  do  not  believe  the  present  or  the  next  generation 
likely  to  develop,  in  cooperative  enterprises,  sufficient  energy 
and  administrative  ability  to  so  control  important  outlying- 
agencies  in  distant  cities  as  to  make  them  a  source  of  profit. 

But  assuming  the  ability  to  manage  such  agencies — and 
it  is  a  fact  that  in  the  particular  case  under  discussion,  the 
exigencies  of  competition  between  Californian  and  other  pro- 
ducers may  soon  render  them  a  necessity — let  us  consider  the 
results  to  Californian  producers  which  would  follow  systematic 
attempts  to  sell  the  retail  trade  from  those  depots. 


THE    ECONOMIC    GAIN    OF    COOPERATION.  263 

The  first  result  would  be  the  bitter  and  unyielding  liostility 
of  every  wholesale  grocer  in  the  districts  invaded.  Of  this 
there  can  be  no  doubt  whatever;  nor  is  there  any  doubt  that 
the  conduct  of  the  fight  on  their  part  would  be  under  far  abler 
direction  than  that  which  any  rewards  which  cooperation  is 
likely  to  offer  will  bring  to  the  management  of  the  coopera- 
tive side.  And  it  is  easy  to  see  the  lines  on  which  they  would 
conduct  the  contest.  Their  first  step  would  be  to  put  all  their 
strength  on  any  lines  of  goods  which  would  best  compete 
with  the  California  product.  These  they  would  advertise  and 
push  by  all  possible  means,  diverting  every  order  which  came 
to  them,  and  which  they  could  influence,  to  the  competing 
article,  and  not  hesitating  a  moment  to  sacrifice  profit,  or  even 
incur  small  losses,  in  order  to  do  so.  This  they  would  hardly 
feel,  since  their  business  would  be  sustained  on  their  profits  in 
other  lines,  while  one  product  alone,  and  that  not  of  universal 
consumption  or  necessity,  must  bear  all  the  burden  of  the 
other  side  of  the  contest.  The  cooperative  agency  would  be 
seriously  handicapped.  In  the  first  place,  nearly  all  retailers 
receive  regular  monthly  visits  from  the  traveling  salesmen 
of  many  wholesale  concerns,  who  are  very  certain  to  get  most 
of  the  trade  unless  the  cooperative  agency  employs  the  same 
means.  Now  a  good  salesman  traveling  among  retailers  at 
the  east  will  cost  $10  a  day,  for  salary  and  expense;  to  earn 
this  at  one-half  cent  a  pound  he  must  sell  a  ton  of  dried  fruit 
per  day,  six  days  in  the  week,  the  year  round,  which  he  can 
not  do.  No  single  salesman  traveling  among  retailers  ever 
sold  thirty  car-loads  of  dried  fruit  in  the  year.  Even  sup- 
posing the  impossible,  there  would  be  the  general  expenses  of 
the  agency  to  be  added,  which  would  certainly  bring  the  cost 
of  selling  to  retailers  to  at  least  three-fourths  of  a  cent,  which 
is  more  than  the  average  profit  of  the  wholesale  merchant; 
and  this  is  supposing  impossible  results  from  a  traveling 
salesman.  With  such  sales  from  them  as  it  is  reasonable  to 
count  upon,  the  cost  of  selling  to  retailers  in  tlie  face  of  oppo- 
sition and  price  cutting  by  tlie  wiiolesalers,  would  probably  be 
four  times  the  ordinary  wholesaler's  profit. 

But  there  is  another  consideration.     Retailers  are  nearly 


264  THE    FARMER    AS    A    COOPERATOR. 

all  men  of  small  means,  who  depend  upon  collections  at  the 
end  of  the  month  to  pay  for  goods  which  they  have  purchased 
during  the  month;  in  the  case  of  country  retailers  having  a 
large  trade  among  farmers,  they  have  to  give,  and  conse- 
quently to  obtain,  longer  credit.  Large  numbers  of  them  are 
practically  "carried"  by  their  wholesale  merchants,  and  could 
not  do  business  otherwise.  It  would  be  simply  impossible  for 
the  majority  to  pay  cash  for  their  supplies,  and  those  who 
could  do  so  would  do  it  only  when  compensated  by  a  good 
reduction  in  price.  It  is  impossible  to  solicit  trade  from  those 
whom  you  refuse  the  credit  customary  in  tlie  trade,  and  those 
from  whom  trade  is  got  most  easily  by  those  newly  seeking  it 
are  invariably  those  whose  credit  is  pretty  well  exhausted 
elsewhere,  and  the  result  of  any  systematic  attempt  to  sell 
retailers  direct  would  inevitably  be  either  a  very  small  busi- 
ness gained  at  a  very  high  price,  or  such  a  gradual  accumu- 
lation of  uncollectable  accounts  as  would  bury  the  idea  of 
profit  out  of  sight. 

There  is  still  another  consideration.  The  same  idea  ol 
convenience  which  leads  the  individual  to  buy  su])plies  of  his 
grocer  rather  than  to  hunt  among  individual  producers,  will 
lead  the  retailer  to  purchase  of  the  wholesale  merchant  from 
whom  he  can  order  at  once,  not  only  one  article  but  whatever 
he  needs,  to  be  ordered  at  one  time,  shipped  at  one  time, 
handled  at  one  time,  and  paid  for  at  onetime;  especially  if 
he  is  having  hard  times  with  his  own  collections,  and  conse- 
quently, although  solvent,  in  need  of  some  extra  accommo- 
dation, he  will  be  careful  not  to  invite  pressure  upon  himself 
by  offending  those  who  can  press  him. 

From  all  the  above  it  is  evident  that  there  can  be  no 
economic  gain  to  a  society  of  producers  in  dispensing  with  the 
services  of  the  retail  or  wholesale  merchant  in  the  lines 
which  ordinarily  handle  their  product,  or  in  engaging  in  any 
sort  of  controversy  or  contest  with  them;  but  on  the  contrary 
it  will  be  most  gainful  to  work  in  entire  harmony  with  them, 
understanding  fully  that  each  one  of  them  will  seek  to  buy  at 
the  lowest  possible  price,  and  sell  at  those  prices  which  in  his 
own  judgment  will  yield  him  most  profit,   but  seeking  con- 


THE    ECOXO>[IC    GATX    OF    COOPERATION.  265 

staiitly  to  diminisli  those  profits  by  bringing  the  product 
involved  into  constantly  more  general  demand,  and  more  and 
more  into  the  position  of  those  staple  articles  of  universal 
consumption  upon  which  the  least  profits  are  made.  A  profit 
of  ten  per  cent  upon  a  staple  and  non-perishable  article  is 
entirely  satisfactory  to  the  wholesale  trade,  whose  expenses 
should  not  exceed  five  per  cent  upon  the  volume  of  their 
business. 

We  may  now  consider  the  necessities  of  the  wholesale 
trade  in  the  matter  of  buying.  It  is  only  the  very  largest 
trade,  doing  a  business  of  many  millions  a  year,  and  over 
very  wide  areas,  who  carry  large  stocks  of  all  classes  of  goods. 
For  the  most  part  their  needs  will  vary  according  to  the 
extent  and  character  of  their  trade,  and  the  section  of  country 
in  which  they  are  located.  To  continue  the  illustration  with 
which  we  began,  a  wholesaler  in  Galveston  would  desire 
smaller  quantities  of  dried  fruit  than  his  competitor  in 
Chicago,  and  very  likely  a  different  assortment  from  the 
merchant  in  Duluth.  It  is  necessary,  however,  that  each  be 
able  to  buy  what  he  needs,  when  he  needs  it,  and  from  ^onie 
one  who  is  responsible  for  its  quality  and  quantity  and  for  its 
delivery  at  the  time  agreed. 

As  no  agricultural  product  is  precisely  or  even  substan- 
tially the  same  either  in  quantity  or  quality  from  year  to  year 
in  any  locality,  it  is  evident  that  the  goods  required  by  the 
merchant  in  Duluth  or  in  Galveston  are  not  likely  to  be 
obtainable,  every  year,  from  the  same  producers,  or  even  the 
same  producing  locality.  It  is  also  evident  that  the  distant 
merchant  can  not  hunt  up  individuals,  or  they  him.  By  some 
means  the  product  scattered  among  individual  producers  must 
be  gathered  at  one  place,  separated  into  its  various  varieties  and 
grades,  properly  packed,  and  held  ready  for  sale  and  shipment 
in  car-load  lots,  either  of  one  variety  and  grade,  or  assorted, 
as  tliB  demands  of  different  merchants  may  require. 

By  competitive  methods  this  concentration  is  accomplished 
by  an  army  of  young  men  who  scatter  through  the  country, 
visit  the  producers  at  their  homes,  examine  the  product,  and 
in  behalf  of   their  principals,   buy   it,   paying   therefor   the 


266  THE    FARMER    AS    A    COOPERATOR. 

agreed  price  when  delivered  at  the  point  where  the  concentra- 
tion is  to  be  made.  This  has  tlie  advantage  of  giving  tlie 
producer  his  money  at  once,  and  the  furtlier  occasional 
advantage — if  it  be  an  advantage— that  buyers  in  their  anx- 
iety to  get  their  supplies  with  the  least  possible  trouble  and 
expense,  sometimes  get  to  competing  with  each  other  and  pay 
more,  in  individual  cases,  than  the  product  is  worth. 

The  immediate  payment  and  closing  the  transaction  is  an 
unquestioned  advantage  to  the  average  producer,  although  in 
the  long  run  it  must  be  paid  for  in  reduced  prices.  For  all 
agricultural  products  require  the  entire  year  for  consumption, 
during  which  time  they  are  of  necessity  "carried"  by  some 
one,  who  must  in  the  meantime  sustain  all  the  expense  and 
risk  of  storage,  interest,  insurance,  shrinkage,  and  deprecia- 
tion, and  if,  in  the  long  run,  there  is  not  a  profit  on  all  this, 
business  could  -not  continue.  As  to  the  occasional  or  even 
frequent  instances  where  the  competition  of  buyers  causes 
them  to  pay  to  producers  more  than  the  market  value  of 
goods,  I  have  only  to  say  here  that  it  is  at  least  questionable 
whether  it  is  ever  to  the  advantage  of  an  industry  to  have 
tradesmen  lose  money  on  its  products.  That  this  does  occur 
is  proved  by  the  frequent  failures  of  the  class  of  speculative 
buyers  who  purchase  largely  with  no  definite  idea  of  where  or 
when  they  are  to  sell. 

But  in  the  long  run  this  does  not  occur.  On  the  contrary, 
very  large  profits  indeed  are  often  made  possible  from  the  fact 
that  buyers  as  a  class  are  alert,  well  informed,  incisive,  and 
free  to  buy  or  not  as  they  please,  while  the  producer  must  sell, 
and  often  must  sell  at  least  a  portion  of  his  crop  at  once,  and 
in  all  other  respects  is  ordinarily  at  a  great  disadvantage  with 
the  buyer.  With  the  average  of  advantage  so  greatly  on  the 
side  of  the  buyer  it  is  not  possible  that  the  average  returns  to 
the  grower  should  be  all  that  they  might  be. 

The  illustration  which  we  are  considering,  of  California 
dried  fruits,  is  perhaps  an  extreme  instance  of  the  disad- 
vantage to  the  producer  of  competitive  methods— a  serai- 
perishable  product  not  in  universal  demand,  annually  increas- 
ing,  as  the   result  of    undue   stimulus,   mure   rapidly   than 


THE    ECONOMIC    (iAIN    OF    COOPERATION'.  2t)7 

markets  are  inclined  to  absorb  it,  produced  at  a  distance  of 
thousands  of  miles  from  its  principal  markets,  and  in  great 
part  by  uneconomical  methods,  and  exposed  to  strong  foreign 
and  domestic  competition  from  those  with  wliom  fruit  is 
rather  in  the  nature  of  a  by  product. 

Under  these  circumstances  it  was  found  that  the  dumping 
upon  an  unprepared  market  of  such  annually-increasing 
products  within  a  space  of  sixty  to  ninety  days  led  to  such  a 
large  number  of  forced  sales  at  prices  ruinous  to  the  producer 
as  involved  a  practical  breaking  down  of  the  market. 
Although  a  few  of  those  most  favorably  situated,  and  free 
from  debt,  were  at  least  able  to  take  in  from  year  to  year  more 
money  than  they  paid  out,  the  average  farmer,  more  or  less  in 
debt,  and  with  insufficient  capital,  began  gradually  or  rapidly 
to  fall  behind. 

The  local  buyers,  who,  under  the  competitive  system., 
collect  and  grade  the  product,  sell  to  the  wholesale  merchant. 
Under  the  circumstances  above  described,  it  was  proposed,  as 
a  remedy,  that  the  producers  themselves  should  collect  and 
grade  their  own  product,  and  from  their  own  storehouses  sell 
to  the  wholesale  merchant  in  car-load  lots. 

There  is  certainly  an  apparent  economic  gain  in  this 
method,  as  it  involves  the  elimination  of,  first,  the  expense  of 
the  buyer's  visiting  each  farm,  often  many  times,  and,  second, 
the  service  of  the  employers  of  those  buyers  in  selling  their 
goods.  The  first  of  these  items  is  nearly  clear  gain;  against 
the  gain  in  the  second  item,  however,  must  be  set  the  expense, 
whatever  it  might  be,  of  those  engaged  in  selling  the  goods  on 
the  part  of  the  growers. 

The  greatest  gain  anticipated  in  the  transaction,  however, 
was  the  relief  to  the  market  arising  from  the  fact  that  instead 
of  marketing  an  entire  crop  within  a  few  weeks,  the  process 
could  be  extended  over  some  months,  during  which  time,  and 
by  the  usual  business  methods,  the  immediate  necessities  of 
the  grower  could  be  relieved  by  advances  from  banks, 
obtained  upon  the  general  credit  of  the  associated  growers, 
and  secured  by  the  fruit  in  store. 

There  are  also  gains,  not  so  readily  apparent  as  the  fore- 


268  THE    FARMER    AS    A    COOPERATOR. 

going;  in  the  first  place,  there  is  a  better  assurance  against 
loss.  There  is  no  credit  business  without  risk,  and  cooperative 
business  is  not  entirely  free  from  risk,  but  produce  is  usually  sold 
in  car-load  lots  to  jobbers,  for  cash  on  inspection  and  delivery. 
With  only  ordinary  management  on  the  part  of  a  cooperative 
society,  the  proceeds  are  nearly  certain  to  at  once  reach  the 
hands  of  the  producer.  If  sold  through  a  commission  house 
the  returns  ought  to  be  equally  prompt  and  certain,  but  it  is 
quite  possible,  and  it  is  alleged  to  be  not  unfrequent  in  the 
trade,  for  a  commission  house  to  retain,  for  some  time,  the 
proceeds  of  a  sale,  and  employ  them  to  make  advances  on 
other  goods,  or  even  for  spsculative  purposes.  Commission 
houses  frequently  fail,  and,  although  owing  to  the  custom  of 
making  large  advances,  they  are  seldom  much  indebted  to 
farmers,  yet  it  is  a  fact  tliat  the  risk  of  loss  to  producers  is 
greater  in  dealing  through  a  commission  house  than  in  selling 
through  a  cooperative  selling  agency  which  ought  never  to 
buy  for  its  own  account  and  seldom  does.* 

It  is  also  a  fact  that  a  strong  and  well-managed  cooperative 
marketing  society  will  nearly  always  be  preferred  by  buyers, 
at  equal  prices,  to  almost  any  private  packing-house,  by 
reason  of  the  greater  assurance  of  honest  packing.  This  is 
simply  because  it  is  not  to  the  private  interest  of  any  coopera- 
tive official  to  pack  dishonestly.  Of  course  it  is  to  the  inter- 
est of  all  men  to  be  honest,  but  there  are  many  business  men 
who  do  not  understand  this,  and  while  the  best  business  firms 
unquestionably  endeavor  to  protect  their  "brands"  by  honest 
packing,  yet  they  are  not  all  of  this  class,  and  no  one  familiar 
with  any  trade  will  deny  that  frauds  in  packing  are  constantly 
attempted,  and  frequently  successful.  The  reputation  for 
honesty  which  is  generally  enjoyed  by  coo})erative  companies 
as  compared  with  the  average  private  company  is  of  decided 
economic  value. 

Another  economic  advantage  is  that  of  associated  credit. 


*The  strongest  cooperative  selling  agency  that  I  know  of  does  upon  occa- 
sion, buy  produce  not  controlled  by  it,  in  order  to  prevent  its  owner.^  from 
underselling.     It  has  always  profited  by  so  doing  thus  far. 


THE  ECONOMIC  GAIN  OF  COOPERATION.         269 

Credit,  like  everything  else  of  value,  must  be  paid  for  by  those 
who  enjoy  it.  If  the  producer  makes  use  of  the  credit  of  a 
commission  house,  in  order  to  get  advances  on  produce  before 
actual  sale,  he  must  pay  for  it  in  some  form,  and  it  is  entirely 
proper  that  he  should.  If,  by  cooperating  with  others,  a  joint 
credit  is  made  available  to  those  who  need  it,  with  compen- 
sating advantages  to  those  who  do  not  need  it,  there  is  a  dis- 
tinct economic  gain.* 

Finally,  and  possibly  of  more  value  than  all  the  rest,  there 
is  a  great  economic  gain  to  cooperators  in  the  knowledge  of 
business  acquired.  In  California,  ten  years  ago,  producers 
were  in  dense  ignorance  of  the  process  necessary  to  convey 
their  products  to  distant  consumers,  of  the  location  of 
important  buyers,  and  of  the  methods  and  their  cost,  neces- 
sary to  reach  those  buyers.  This  was  true  even  of  the  most 
intelligent.  It  is  still  true  in  the  sections  where  cooperative 
methods  have  not  been  introduced.  The  members  of  the 
great  cooperative  societies,  however,  are  coming  to  be  well- 
informed  on  such  matters,  of  the  competition  which  they  must 
meet,  the  cost,  to  producers,  of  competing  products,  and  their 
qualities,  as  compared  with  their  own,  and  in  general  of  all 
the  facts  of  which  knowledge  is  essential  to  intelligent  produc- 
tion in  marketing.  The  value  of  this  training  can  not  be 
computed  in  definite  amounts  of  money,  but  it  is  very  large. 
The  members  of  these  societies  who  give  ordinary  attention  to 
the  cooperative  business  can  seldom  be  taken  advantage  of  in 
trade  by  anybody. 

In  these  and  similar  circumstances,  therefore,  distinct 
economic  gains  are  possible  thi-ough  cooperation  of  producers, 
as  follows : — 


*The  most  valuable  use  of  associated  credit  that  I  know  of  is  in  the  case  of 
the  cooperative  loan  associations  common  in  Saxony,  and  spreading  in  other 
parts  of  Europe.  In  these  associations  the  entire  property  of  each  member 
is  liable,  without  reservation,  for  all  debts  of  the  association.  Upon  this  credit 
the  association  issues  bonds,  and  loans  the  proceeds  to  its  members.  The  secu- 
rities are  in  great  favor  with  capitalists,  and  in  consequence  money  is  borrowed 
so  cheaply  that  it  can  be  reloaned  to  members,  on  mortgage,  at  from  ihree  to 
four  per  cent  per  annum. 


270  THE    FAKMER    AS    A    COOPERATOE. 

1.  Elimination  of  the  expense  of  concentration  for  sale. 

2.  Elimination  of  expense  of  any  local  intermediary 
between  producers  and  wholesale  merchants. 

3.  Elimination,  to  a  great  extent,  of  the  necessity  for 
forced  sales. 

4.  Better  insurance  against  loss. 

5.  "Good  will"  of  business  arising  from  assurance  of 
honesty. 

6.  Associated  credit. 

7.  Business  education  acquired. 

The  saving  under  the  first  two  heads,  although  unques- 
tioned, is  not  large.  If,  instead  of  downright  sales  to  local 
buyers,  it  is  i)referred  to  use  them  as  commission  agents 
selling  to  wholesale  merchants,  all  the  service  required  for 
concentration  of  product  and  local  service  in  selling  in  tlie 
trade  taken  as  an  example,  can  be  obtained  for  about  two  and 
one-half  per  cent  of  the  receipts  for  goods  sold.  The  actual 
cost  of  all  the  local  service  required  by  cooperative  methods 
will  of  course  vary  partly  by  the  amount  involved,  and  much 
more  by  the  personal  equation  of  the  management.  It  should 
not  exceed  one  per  cent,  but  as  a  matter  of  fact  wall  vary  from 
three-fourths  of  one  per  cent  to  one  and  one-half  per  cent. 
Even  this  slight  saving,  if  applied  to  the  entire  product  of  a 
large  state,  would  be  well  worth  distributing."  Upon  the  total 
fruit  and  fruit  product  output  of  California  it  would  amount 
to  about  a  quarter  of  a  million  dollars  annually. 

But  the  most  important  gain  arises  from  the  elimination 
of  forced  sales,  and  the  deliberate  marketing  of  the  product  in 
the  light  of  the  full  information  as  to  its  value  which  gradu- 
ally becomes  disseminated  during  the  marketing  season.  The 
amount  of  the  gain  to  the  producer  can  of  course  never  bo 
known,  or  even  estimated  with  much  approach  to  accuracy. 
It  will  vary  greatly  in  different  industries  and.  different  local- 
ities, and  in  different  seasons  in  the  same  locality  and  indus- 
try, but  I  do  not  think  any  one  familiar  with  the  conditions 
of  the  Californian  industry  taken  as  an  illustration  would 
estimate  the  probable  gain,  if  all  producers  were  cooperatively 
united,  at  less  than  ten  per  cent,  or  that  following  the  organ- 


THE    ECONOMIC   GAIN   OF   COOPERATION.  271 

ization  of  any  reasonable  number  at  less  than  five  per  cent. 
The  possible  gain  would  diminish  as  the  locality  of  the  pro- 
ducers should  approach  nearer  to  the  great  markets  of  the 
world,  inducing  more  competition  among  buyers  and  better 
information  among  producers. 

In  opposition  to  this  conclusion,  some,  and  possibly  most 
economists  would  insist  that  natural  selection  would  attract  to 
trade  those  best  qualified  to  conduct  it,  and  that  competition 
among  them  would  enable  i)roducers  to  obtain  their  services 
at  the  lowest  rate  at  which  they  could  live  and  prosper,  and 
that  any  attempt  to  interfere  with  the  regular  operation  of 
these  economic  forces  will  in  the  long  run  be  futile,  and  in  so 
far  as  temix>rary  success  might  seem  to  be  achieved,  investiga- 
tion would  certainly  disclose  real  economic  loss. 

To  follow  this  discussion  far  in  this  direction  would  cer- 
tainly make  these  pages  too  technical  for  popular  reading,  and 
would  moreover  involve  the  study  of  data  as  yet  uncollected, 
so  far  as  I  know,  and  unavailable.  The  situation  of  the 
industry  mentioned  as  above  given  correctly,  unquestion- 
ably shows  tiie  possibilit}^  of  economic  gain.  The  argument 
opposed  to  it  is  based  upon  the  law  of  natural  selection  as 
applied  to  human  effort.  Perhaps  the  best  rejoinder  that  can 
be  made  in  general  terms  is  that  from  the  foundation  of  the 
world  the  progress  of  man  has  been  a  series  of  struggles  with 
nature — including  his  own  nature — and  that  no  man  can  yet 
say  that  the  evolution  of  the  race  does  not  tend  towards  forms 
of  life  wherein  cooperative  effort  shall  take  the  place  of  com- 
petitive struggle. 

There  is  another  matter  which  is  perhaps  best  considered 
in  this  connection,  which  is  the  moral  gain  under  cooperative 
methods.  Without  argument  I  shall  assume  that  any  estab- 
lished and  continued  moral  gain  in  the  management  of  any 
industry  inevitably  carries  with  it  a  corresponding  economic 
gain.  Returning  to  our  illustration  we  find  the  facts  'to  be 
these:  the  increasing  output  of  fruits  of  California  has  devel- 
oped under  competitive  methods  such  an  annually-increasing 
distrust  of  values  as  to,  in  some  branches,  almost  entirely 
destroy  the  local  market  which  I  have  been   assuming,  and 


272  THE    PARMER   AS    A    COOPERATOR. 

which  can  always  be  relied  upon,  in  any  industry  when  the 
demand  equals  or  exceeds  the  supply.  When,  as  in  the  case 
in  question,  the  supply  has  outrun  immediate  demand,  buyers 
refuse  to  take  the  product  in  quantities  sufficient  to  relieve  the 
producer,  but  offer,  instead,  to  act  as  commission  merchants  in 
its  sale. 

This  introduces  an  entirely  new  element.  The  farmer, 
unaccustomed  to  business,  and  with  no  means  of  distinguish- 
ing between  honest  and  responsible,  and  dishonest  and  irre- 
sponsible men,  is  practically  compelled  to  put  his  product  for 
sale  into  the  hands  of  those  who  may  be  entire  strangers  to 
him,  and  who  have  no  settled  place  of  business  within  his 
reach. 

Such  a  state  of  things  is  a  direct  temptation  to  dishonesty, 
and  the  possibility  of  dishonesty  with  small  likelihood  of 
punishment  or  even  public  exposure,  is  as.  certain  to  attract 
those  disposed  to  dishonesty  as  sugar  is  to  attract  flies.  This 
results  in  drawing  to  the  commission  business,  among  many 
as  honorable  and  trustworthy  persons  as  can  be  found  any- 
where in  business,  an  undue  proportion  of  the  dishonest  and 
contemptible.  An  observation  of  some  years  convinces  me 
that  a  large  number  of  those  engaged  in  the  produce  com- 
mission business  really  merit  the  unenviable  reputation 
they  have  among  producers,  and  from  wliich  even  the  most 
upright  conduct  of  many  individuals  is  unable  to  relieve 
them.  The  consequence  has  been  an  immense  amount  of 
friction  between  producers  and  those  who  should  be  their 
confidential  and  friendly  agents,  leading  to  a  profound  dislike 
and  distrust  of  the  entire  class  of  commission  merchants, 
honest  as  well  as  dishonest;  and  there  is  no  question  tliat  the 
amount  of  dishonesty  and  trickery  practised  by  those  among 
them  who  have  that  disposition,  while  by  no  means  so  great 
as  is  popularly  supposed,  is  really  sufficient  to  cause  serious 
loss  to  the  class  of  producers,  and  consequently  to  demand 
remedy.  The  standard  of  honor  among  commission  men 
is  certainly  far  lower  than  the  proper  conduct  of  business 
requires,  and  lower  than  among  merchants  who  buy  and  sell 
upon  their  own  account. 


THE    ECONOMIC    GAIN    OF    COOrERATION.  273 

It  would  be  easy  to  show  in  detail  just  how  this  distrust 
and  dislike  on  the  part  of  producers,  even  if  not  justified, 
would  lead  to  economic  loss,  much  more  when  there  is 
a  certain  amount  of  foundation  for  it.  But  I  assume  that 
the  consequence  is  as  patent  to  others  as  to  myself.  All  this 
is  completely  done  away  with  by  cooperation  on  the  part  of 
producers,  although,  as  has  already  been  pointed  out,  its  place 
is  to  too  great  an  extent  taken  by  distrust  of  their  own  sala- 
ried agents.  But,  on  the  whole,  as  the  motive  and  the  oppor- 
tunity for  dishonesty  will  be  far  less  in  the  latter  case,  so,  also, 
on  the  whole,  will  the  reality  be  less,  as  well  as  the  distrust. 
I  am  convinced  that  there  is  in  cooperation  a  decided  bal- 
ance of  moral  gain  under  such  circumstances  as  have  been 
described,  and  that  it  leads  to  a  distinct  economic  gain 
which  exists  none  the  less  that  it  can  not  be  computed  and 
set  down  in  figures. 

There  is,  however,  a  word  of  caution  which  must  not 
be  omitted.  There  can  be  no  economic  gain  unless  there  is 
forthcoming  a  volume  of  business  sufficient  to  warrant  the 
fixed  expenses  necessary  to  transact  it.  A  small  neighbor- 
hood association  can  seldom  profitably  attempt  to  sell  in 
distant  markets,  because  the  cost  of  securing  and  maintaining 
the  necessary  business  connections,  when  spread  over  a  small 
volume  of  business,  will  nmke  the  cost  to  individuals  too 
great.  Such  associations  can  secure  the  gain  of  concentration 
but  must  sell  to  local  buyers,  or  through  some  other  agency. 
The  tendency  of  modern  business  is  into  concentration  in 
trusts.  This  tendency  is  reaching  the  farmers  and  must 
ultimately  prevail  with  them  as  with  others.* 


*  During  the  season  of  1898,  the  raisin-growers  of  California  perfected  and 
maintained  through  the  year  an  effective  trust  controlling  about  ninety  percent 
of  the  output.  The  trust  was  for  one  year  only,  and  as  these  lines  are  written 
they  are  endeavoring  to  renew  it  for  two  years,  and  the  prune-growers  of  the 
state  are  attempting  to  form  a  similar  trust.  The  grape-growers  of  New  York 
and  Ohio  maintained  a  similar  trust  during  the  same  season.  The  California 
walnut-growers  have  a  trust,  and  the  orange-growers  also,  except  that  the  latter 
has  never  yet  been  able  to  control  a  sufficient  portion  of  the  output  to  make  it 
effective.  These  trusts  are  not  yet  as  effective  as  the  great  mercantile  trusts, 
but  the  farmers  arc  learning. 
18 


274  THE    FARMER    AS    A    COOPERATOR. 

It  should  be  apparent  from  the  foregoing  that  there  can  be 
no  economic  gain  to  cooperative  associations  of  producers  in 
dispensing  with  the  services  of  wholesale  and  retail  merchants, 
or  in  any  attempt  to  directly  control  prices  at  which  they  shall 
sell  the  goods  for  which  they  have  paid  their  money,  but  that, 
ou  the  contrary,  loss  is  almost  sure  to  follow  such  attempts. 
It  seems  also  clear  that  cooperation  does  offer  opportunity  for 
gain  within  reach  of  such  reasonable  ability  and  pei'sistence  as 
ought  to  be  available  in  concentrating  and  grading  the  product 
for  the  market. 

It  remains  to  examine  the  manner  in  which  the  concen- 
trated and  graded  product  in  the  hands  of  associated  producers 
can  be  best  sold  and  delivered  to  the  wholesale  merchant;  and 
in  this  I  shall  assume  that  the  product  is  to  go  direct  from 
the  warehouse  of  the  producers  to  those  of  the  wholesale  mer- 
chants. Those  warehouses  may  be  situated  near  the  point  of 
production,  or,  if  the  market  is  distant,  and  competition  com- 
pels, they  may  be  in  the  principal  marketing  centers.  I  have 
already  stated  that  I  do  not  believe  cooperative  organization 
equal  to  the  strain  of  maintaining  and  profitably  supervising 
distant  warehouses  from  which  goods  can  be  sold  in  small 
lots,  and  under  conditions  which  retailers  would  require, 
but  it  is  possible,  although  to  be  avoided  unless  compelled  by 
competition,  to  simply  arrange  for  sales  for  cash  only  in  such 
considerable  but  less  than  car-load  lots  as  wholesale  merchants 
can  use.*  ■ 

The  product  must  be  brought  to  the  attention  of  the  whole- 
sale merchant  by  solicitation.  Farmers  sometimes  appear  to 
suppose  that  merchants  go  out  and  canvass  the  market  for 
their  sui)plies.     They  do  not.     They  sit  in  their  offices  and 


*  It  may  be  said  that  it  is  always  unwise  to  refuse  to  sell  to  any  one,  either 
wholesaler  or  retailer,  who  otters  to  pay  in  cash  tlie  price  asked  for  the  i^oods 
offered.  The  price  of  car-load  lots  of  any  product,  however,  must  always  bo 
less  than  the  price  of  small  lots  of  the  same  goods,  and  the  wholesale  merchant 
whose  aggregate  annual  purchases  may  be  many  car-loads,  may  always  with 
propriety  buy  at  the  same  price  such  smaller  lots  as  he  may  from  time  to  time 
need  to  complete  his  assortment;  while  an  occasional  customer,  whether  whole- 
sale or  retail,  buying  a  small  lot,  would  expect  to  pay  a  higher  price. 


THE    ECONOMIC    GAIN    OF    COOPERATION.  275 

buy  from  samples  which  are  brought  to  them.  Of  course,  if 
for  any  product  there  is  a  hirge  demand  and  small  supply, 
merchants  will  hunt  for  it;  but  I  know  of  no  such  agricultural 
product,  and  if  there  be  one,  its  producers  are  not  interested  in 
cooperation,  which,  as  has  already  been  said,  is  seldom  under- 
taken by  those  who  readily  find  profitable  sale  for  their  prod- 
ucts without  it. 

An  association  of  producers,  therefore,  having  collected  its 
product,  and  pre))ared  it  for  market,  has  only  one  thing  to  do, 
which  is  to  obtain  a  list  of  wholesale  customers — of  whom 
there  are  but  a  few  hundred  in  the  country  in  any  line — 
advertise  their  goods,  either  by  circulars  or  newspapers,  and 
then  cause  each  customer  to  be  regularly  and  persistently 
solicited  for  orders.  There  is  absolutely  nothing  more  to  the 
selling  of  goods  than  this.  It  is,  however,  a  matter  of  infinite 
detail,  requiring,  in  any  considerable  business,  the  unremitting 
attention  and  effort  of  very  capable  men,  not  only  to  obtain 
the  orders,  but  to  fill  them  with  such  promptness  and  entire 
honesty  as  to  retain  customers  wdien  secured.* 

The  necessary  solicitation  must  be  done  by  one  of  two 
classes  of  men — brokers,  or  salaried  traveling  agents.  Brokers 
are  men  usually  of  some  standing  and  responsibility,  not 
usually — but  sometimes — having  a  "  store,"  f  but  living  by 
the  sale  of  commodities  to  merchants  for  a  commission  usually 
paid  by  the  seller.  Of  course,  brokers  are  often  employed  to 
buy  goods,  in  which  case  they  act  for  the  buyer,  and  are  paid 
by  him,  and  have  regard  to  his  interests  only;  while  the  broker 
paid  by  the  seller  is  bound  mainly  to  consider  his  interests, 
although,  as  a  matter  of  fact,  since  his  income  depends  upon 
actual  sales  made,  his  tendency,  from  various  causes,  in  case 
of  disagreement  as  to  price,  is  rather  to  induce  sellers  to  lower 


*For  the  benefit  of  cooperative  societies,  I  will  say  that  they  will  have  little 
trouble  in  finding  managers  who  know  how  to  do  these  things,  but  there  will 
be  very  great  trouble  indeed  in  finding  those  who  will  actually  do  them. 
Attention  to  detail,  not  knowledge  of  principles,  is  the  test  of  the  business 
man,  and  it  is  this  labor  which  breaks  men  down. 

t  A  broker  with  a  "store"  is  a  commission  merchant.  The  two  classes 
merge  into  each  other. 


276  THE    FAFIMER    AS    A    COOPER ATOR. 

their  price  than  to  get  buyers  to  raise  tlieir  offers,.  Brokers 
endeavor  to  represent  as  many  interests  as  j)ossible,  so  that  if 
a  possible  customer  does  not  need  one  thing,  he  may  sell  him 
another.  They  also  like  to  represent  as  many  persons  as  i)os- 
sible  in  the  same  line,  so  that  if,  for  any  reason,  one  seller  will 
not  accept  offers  whicli  he  can  obtain,  another  one  may.  His 
first  and  last  desire  is  to  make  sales.  The  brokerage  or  com- 
mission paid  to  him  by  sellers  varies  according  to  the  com- 
modity; the  better  known  and  more  staple  the  article,  the 
easier  sales  will  be  made  and  the  smaller  tlie  brokerage. 
Upon  dried  fruits,  whicli  I  have  used  for  an  illustration, 
brokerage  upon  orders^  passing  direct  from  the  seller's  ware- 
house to  merchants,  range  from  one  and  one-half,  or  even 
one  per  cent,  to  two  and  one-half  per  cent.  If,  however,  the 
goods  are  shipped  to  them,  as  commission  merchants,  stored, 
insured,  and  disposed  of  in  broken  lots,  their  brokerage  may 
be  as  high  as  five  per  cent.  Upon  the  average,  two  and  one- 
lialf  per  cent  must  be  reckoned  upon.  There  is  never  any 
advantage  in  so  reducing  rates  of  brokerage  on  competitive 
articles  that  the  broker  can  make  no  money  on  them.  The 
broker  will  be  compelled  to  neglect  them  and  lay  out  his 
strength  on  what  pays  him  better. 

The  other  class  of  solicitors  is  traveling  salesmen.  The 
advantage  of  this  class  is  that  they  are  wholly  in  their  employ- 
er's interest,  with  nothing  to  distract  their  attention.  Their 
disadvantage  is— in  the  wholesale  trade — that  they  can  see 
their  customers  but  seldom,  while  the  resident  broker  can  see 
tliem  almost  daily,  and  they  also  cost  more  money.  AVhen  the 
broker  is  not  selling  goods  he  is  costing  liis  employer  nothing, 
while  the  salary  and  expense  of  the  traveling  salesman  go  on 
every  day.  In  some  lines,  however,  travelers  are  doubtless 
the  most  profitable.  Whether  they  are  ever  so  in  the  lines  in 
which  cooperative  societies  of  producers  are  interested  is  more 
than  doubtful.  It  is  not  difficult  to  mnke  a  comparison,  once 
more  recurring  to  the  dried-fruit  trade  for  an  example.  The 
average  value  of  a  car-load  of  dried  fruit  may  be  placed  at 
$1,000,  upon  which  the  brokerage  at  two  and  one  half  per 
cent   would   be   $25.     A  capable  and    experienced    salesman, 


THE    ECONOMIC    GAIN    OF    COOPERATION.  277 

strong  enough  and  sufficiently  informed  to  interest  and  hold 
the  able  men  engaged  Ln  wholesale  merchandising,  will  com- 
mand say  $200  per  month.  His  expenses,  traveling  long 
distances  between  principal  cities,  will  not  be  less  than  $150 
per  montii,  making  $350  per  month  in  all.  He  will,  therefore, 
have  to  sell  a  car-load  of  fruit  of  the  average  value  of  $1,000 
every  other  day  from  tlie  time  lie  leaves  home  until  he  returns, 
in  order  to  make  his  salary  and  expenses  less  than  two  and 
one  half  per  cent  of  the  value  of  goods  sold.  Wiiile  this 
result  would  unquestionably  be  achieved  in  some  months  and 
by  some  men,  it  can  not  be  counted  upon,  and  would  usually 
not  happen.  Especially  it  is  true  that  cooperative  societies 
are  not  likely  to  employ  men  capable  of  doing  such  work. 
There  are  more  salesmen  sent  out  by  such  societies  who  come 
home  with  few  or  no  sales  than  of  those  who  can  earn  their 
cost  out  of  a  reasonable  commission.  It  is  very  difficult  for 
the  very  best  men,  in  the  face  of  constant  competition  from 
brokers  and  others,  to  earn  their  cost  by  selling  any  one 
article.  It  is  therefore  unquestionably  safest  for  cooperative 
societies  to  follow  the  usual  custom  of  tlie  trade  in  employing 
brokers  rather  tlian  traveling  salesmen.  Of  course  a  good 
brokerage  system  requires  a  certain  amount  of  traveling 
supervision,  to  keep  in  touch  with  the  brokers  and  with  tlie 
market,  but  one  trip  a  year  among  them  is  amjde  for  this,  and 
the  allowance  for  brokerage  which  I  have  made,  should  fully 
cover  that  expense  in  a  large  business. 

Whichever  method  is  employed  there  is  no  possible  gain 
to  cooperation  as  compared  with  competitive  business  in  this 
operation.  Whether  the  product  be  collected  by  local  opera- 
tors, or  by  cooperative  societies,  the  methods  of  reaching  the 
wholesale  trade  will  necessarily  be  the  same,  and  involve  the 
same  expense. 

An  economic  gain,  therefore,  possible  to  producers  by 
cooperative  methods,  is  confined  to  the  initial  stages  of  the 
progress  of  the  product  to  market. 

Having  thus  followed  out  in  detail  the  application  of 
cooperative  methods  of  distribution  to  one  product  produced 
at  a  great  distance  from  its  principal  markets,  any  one  by  apply- 


278  THE    FARMER    AS    A    COOPERATOR. 

ing  the  same  analytic  method  to  the  known  facts  and  condi- 
tions of  any  other  industry  in  which  he  may  be  interested, 
and  taking  into  consideration  the  special  infirmities  of  human 
nature  which  have  been  pointed  out,  can  very  well  judge 
whether,  and  to  what  extent,  cooperative  effort  in  distribution 
is  likely  to  lead  to  economic  gain.  My  own  conclusion  is  that 
under  some  circumstances,  and  in  some  industries,  economic 
gain  may  be  expected  from  cooperative  methods  applied  to  the 
entire  progress  of  the  product  from  the  hands  of  the  producer 
to  the  wholesale  merchant;  in  other  cases,  the  entire  possible 
gain  will  be  achieved  by  confining  those  methods  to  the  initial 
stages  of  the  work,  that  is,  the  concentration,  leaving  the  actual 
distribution  to  be  effected  by  competitive  methods;  in  still 
other  cases  perhaps  competition  unhampered  can  best  do  the 
woi'k.  It  depends  upon  the  facts  in  each  case.  Human  nature 
will  be  found  very  much  the  same  everywhere.* 

One  thing  is  certain :  cooperation  based  entirely  on  senti- 
ment offers  no  hoi)e  of  economic  gain.  It  will  be  mismanaged 
and  will  probably  fail.  It  must  be  a  business  organization, 
based  and  conducted  on  business  principles,  expecting  no 
unpaid  or  half-paid  service  of  any  value,  but  always  ready  to 
compete  in  the  market  for  such  talent  and  labor  as  it  needs, 
and  not  expecting  to  secure  able  management  for  any  less 
compensation  than  the  same  ability  can  obtain  in  competitive 
service.  All  hope  of  economic  gain  depends  on  this;  for  it  is 
on  industrious  and  intelligent  attention  to  detail  that  the 
success  of  either  cooperative  or  competitive  business  depends, 
and  this  attention  can  only  be  continuously  obtained  by  the 
expectation  and  enjoyment  of  adequate  reward. 


*The  possibilities  of  societies  of  cooperative  purchasers,  that  is,  coopera- 
tive "stores,"  reachiiio;oiit  to  obtain  their  supplies  from  cooperative  societies  of 
producers,  which  are  often  alluded  to,  I  purposely  pass  over,  because  they  are 
merely  possibilities.  It  would,  of  course,  form  the  next  step  in  the  social  evolu- 
tion which  is  the  dream  of  many.  I  think,  however,  that  an  associated  society 
of  small  purchasers  would  be  hard  customers  to  sell  to,  and  that  they  would 
find  societies  of  producers  the  worst  possible  lot  to  buy  from.  They  would 
doubtless  agree  in  the  desire  to  crowd  out  the  "  middli'man,"  but  each  side 
would  expect  all  the  profit  of  the  transaction.  Of  course  a  cooperative  store 
would  take  the  place  of  any  otlicr  retailer  in  distribution. 


CHAPTER    VIII. 

ALTRUISM     IN     COOPERATION. 

ALTRUISM  means  regard  for  others.  It  is  the  key-note  of 
the  exhortations  of  many  advocates  of  practical  cooper- 
ation. We  slioLild  cooperate  because  public  welfare 
demands  it.  An  earnest  worker  in  practical  cooperation  once 
wrote  me  that  he  had  no  faith  in  the  success  of  any  coopera- 
tive movement  not  inspired  and  sustained  by  the  altruistic 
spirit.  For  myself  I  must  confess  that  when  observing  the 
inception  and  conduct  of  cooperative  business  enterprises, 
I  have  never  yet  been  able  to  think  clearly  enough  to  settle  to 
my  own  satisfaction  the  degree  in  which  altruism  contributed 
to  results.  The  philosopher  says  truly  that  we  can  not  con- 
template any  joint  action  of  one's  self  with  another  for  a  com- 
mon purpose  without  having  regard  for  the  welfare  of  that 
other,  which  is  altruism.  However  true  this  is,  it  is  not 
satisfying.  The  question  is,  What  is  the  motive  which  impels 
one  to  act?  I  have  personally  observed  some  hundreds  of 
men  sign  subscriptions  to  the  stock  of  cooperative  societies, 
and  participated  in  the  conversations  which  preceded  that  act. 
In  all  these  conversations,  I  presume,  the  public  benefit  to 
accrue  was  made  prominent,  and  in  a  great  many  it  was  the 
motive  avowed  as  the  leading  one  which  induced  signature. 
I  seldom  believed  it  to  be  the  real  motive,  although  in  some 
cases  there  could  be  little  doubt  of  it.  I  have  never  been  able 
to  analyze  even  my  own  motives  in  joining  such  societies,  and 
in  promoting  them.  Certainly  I  never  joined  one  without 
seeing  in  the  act  a  distinct  personal  advantage  to  m3^self,  and 
yet  reason  told  me  that  if  I  wished  to  exert  myself  in  the 
proposed  lines  of  trade,  it  would  be  more  profitable  to  employ 
my  business  experience  and  vigor  in  exploiting  the  more 
ignorant  than  in  aiding  them  to  resist  exploitation.  It  hap- 
pened that  I  had  no  such  wish,  so  that  in  joining  them  I  was 

(279) 


280  THE    FARMER    AS    A    COOPERATOR. 

merely  giving  up  someLliing  for  which  I  had  no  desire,  in  the 
prospect  of  getting  sometliing  which  I  might  enjoy.  I  do  not 
care  to  imply  that  I  have  no  altruism  in  my  make-up,  for  I 
suppose  myself  to  be  an  average  man  in  that  respect,  but 
merely  to  avow  that  I  can  not  say  that  I  think  altruism  could 
have  prevailed  against  strong  self-interest.  Had  I  wished  to 
engage  in  dealing  in  the  commodities  which  we  were  organizing 
to  market  independently  of  dealers,  I  am  quite  sure  I  should 
have  not  become  a  cooperator.  My  judgment  of  my  own 
motives  corresponds  precisely  with  my  judgment  of  tlie 
motives  of  others,  and  the  number  of  those  whom  I  have 
observed  in  the  act  of  joining  cooperative  societies  has  been 
large  enough  to  afford  a  very  fair  foundation  to  generalize 
upon.  In  a  few  cases  the  force  of  altruism  was  probably  para- 
mount. In  a  very  few  it  was  probably  entirely  lacking.  In 
some  instances  it  was  merely  tlie  temporary  yielding  of  a  weak 
will  to  a  stronger  one.  With  the  majority  I  am  convinced 
that  the  controlling  motive  was  self-interest,  more  or  less  aided 
by  altruism  and  other  motives  which  do  not  concern  this  dis- 
cussion. At  any  rate,  tlie  conclusion  I  have  reached  is  that 
the  altruistic  spirit  affords  no  safe  foundation  upon  which  to 
erect  a  business  enterprise.  It  is  a  noble  spirit,  and  it  is 
powerful  in  the  affairs  of  men.  But  it  is  not  business.  And 
upon  the  whole  I  am  constrained  to  doubt  whether  it  is  desir- 
able that  acts  intended  to  increase  our  aggregate  of  economic 
satisfactions  should  spring  from  motives  which  in  any  great 
degree  ignore  that  object,  and  are  even,  possibly,  more  or  less 
contradictory  to  it.  It  does  not  seem  to  me  that  results  will 
be  so  good,  or  the  aggregate  of  satisfactions  attained  for 
equitable  distribution  so  large.  As  stated  in  previous  chapters 
of  this  book,  it  has  not  been  my  observation  that  altru- 
ism is  a  reliable  thing  to  build  up  a  business  upon.  While, 
happily,  no  man  is  entirely  M'ithout  altruism,  with  the  average 
man  these  emotiona  impulses  are  not  persistent,  and  the 
impulse  which  moves  a  business  enterprise  must  never  fail. 
There  is  an  unquestioned  field  for  altruism  in  cooperation, 
but  it  seems  to  me  that  its  most  effective  use  will  be  in  the 
promotion  of  the  coo])erative  work  at  the  hands  of  those  who 


ALTRUISM    IX    COOPFRATION.  281 

are  for  the  time  being  independent  of  it.  A  notable  instance 
of  this  is  the  promotion  of  cooperation  among  the  Irish 
peasantry  by  a  society  of  wealthy  men  and  women.  This 
society  raised  funds,  printed  and  distributed  documents, 
employed  traveling  lecturers,  counseled  with  newly-formed 
associations,  and  in  all  ways  sought — and  is  still  seeking — to 
promote  cooperation,  especially  in  dairying,  among  the  Irish 
peasantry.  The  societ}'  has  been  successful  and  is  accomplish- 
ing great  good.  The  motives  of  its  members  are  purely 
altruistic.  They  seek  the  good  of  the  people.  But  the  object 
which  they  hold  out  to  induce  cooperation  is  not  the  good  of 
Ireland,  but  the  welfare  of  the  individual  cooperators.  That 
is  an  entirely  legitimate  motive,  and  it  seems  to  me  the  pro})er 
one  in  this  case.  No  one  can  appreciate  the  altruistic  spirit 
more  profoundly  than  I,  or  have  higher  regard  for  the  many 
who  are  unquestionably  dominated  by  it;  but  I  have  never 
seen  it  mix  well  with  business.  On  the  contrary,  it  is  apt  to 
mix  very  badly.  There  is  an  innate  suspicion  of  those  who 
avow  an.  altruistic  motive  for  what  they  expect  to  profit  by. 
To  promote  our  own  welfare  is  not  sordid  or  ignoble.  It  is 
what  we  are  here  for.  It  seems  to  me  best  to  claim  no  higher 
motive  for  cooperation  than  the  material  advantage  of  the 
cooperator.  Doubtless  there  are  many  populations,  like  those 
of  Ireland,  and,  doubtless,  some  parts  of  America,  where  there 
is  a  great  field  for  an  altruistic  propaganda  of  cooperation  on 
the  part  of  those  who  are  perhaps  not  engaged  in  the  industry 
which  it  is  proposed  to  organize;  but  among  the  intelligent 
farmers  of  the  United  States  it  seems  to  me  best  that  they 
should  say  to  each  other,  "  Let  us  do  this  because  it  will  })ay  us." 
I  say  this  while  perfectly  aware  tiiat  some  of  the  most 
successful  cooperative  enterprises  in  the  world  are  avowedly 
based  on  the  fraternal  spirit.  The  great  British  cooperative 
stores  do  an  immense  amount  of  work  for  the  moral  as  well 
as  the  material  welfare  of  their  members,  and  the  literature 
whicli  they  distribute  is  highly  altruistic  in  tone.  It  doubtless 
helps  to  hold  their  membership  more  strongly.  But,  after  all, 
it  is  the  benefit  to  the  individual  that  is  made  most  jirominent. 
The  great    life-insurance  secret  societies  are  unquestionably 


282  THE    FARMER    AS    A    COOPERATOR 

made  possible  only  by  the  spirit  of  fraternity  which  is 
cultivated  in  the  lodges.  But  life  insurance  itself  is  essentially 
altruistic,  and  even  in  these  societies  it  is  the  expectation  of 
benefit  to  one's  immediate  family,  and  not  the  welfare  of 
mankind,  which  holds  the  lodges  together.  And  mankind  is 
benefited  just  the  same,  as  it  will  also  be  by  successful 
cooperation  among  all  classes. 

Of  course  I  do  not  belittle  the  influence  of  the  fraternal 
spirit,  which  naturalh^  grows  up  among  those  associated  for  a 
common  purpose,  nor  would  I  fail  to  make  use  of  it,  as  the 
British  cooperative  stores  and  the  life-insurance  societies  do, 
but  I  think  that  the  avowed  motive  of  all  business  action 
should  be  the  economic  advantage  of  those  concerned  in  it.  It 
may  properly  be  promoted,  and  helped  through  its  infancy,  by 
unremunerated  work  contributed  from  altruistic  motives,  but 
a  cooperative  enterprise  when  once  established  should  be  run 
on  business  principles.  Its  directors  may,  and  usually  will, 
contribute  their  time,  except  in  very  large  societies,  but 
beyond  that  the  society  should  expect  no  gifts.  When  the 
sense  of  mutual  advantage  will  not  hold  the  members  of  a 
society  together,  it  is  usually  an  indication  that  they  have  not 
yet  been  suffi.ciently  disciplined  by  disastrous  competition. 
They  need  a  few  seasons  more  and  should  have  it.  When 
they  have  been  reduced  to  the  necessary  distress  they  will 
cooperate.  Until  that  time  they  can  not,  so  far  as  my  observa- 
tion goes,  be  held  together  by  their  love  of  other  people.  It 
would  be  well  if  they  could,  but  they  can  not.  The  logical 
end  of  cooperation  is  the  formation  of  an  effective  trust. 
Whatever  stops  short  of  tliat  is  by  so  much  the  less  effective. 
The  same  economic  pressure  which  resulted  in  the  formation 
of  the  Sugar  Trust  also  resulted  in  the  fornnition  of  the 
llaisin  Trust  of  the  California  raisin-growers,  which  h:is  been 
in  existence  for  a  year  as  I  write,  and  mny  or  may  not  be 
permanent.  The  motives  of  those  who  united  in  it  were 
identical  with  those  who  united  in  the  Sugar  Trust.  A  much 
larger  number  of  individuals  were  concerned,  and  tliey  were 
enduring  a  far  greater  degree  of  suff'ering  than  is  likely  to 
befall  a  body  of  ca])italists  or  manufacturers,  but  it  seems  to 


ALTRT'ISM    IX    COOPERATION.  283 

me  tliat  the  result  in  each  case  was  produced  by  the  same 
economic  law,  and  it  w'as  not  the  law  of  altruism.  In  the 
case  of  the  Raisin  Trust  there  can  be  no  doubt  that  to  a 
considerable  extent  it  w^as  promoted,  from  altruistic  motives, 
by  those  who  expect  no  direct  personal  profit.  The  function 
of  altruism  in  cooperation  seems  to  me  to  be  that  of  inducing 
other  people  to  act  according  to  their  own  best  interests.  And 
it  is  doubtless  a  noble  object. 


CHAPTEK    IX. 

SOME  farmers'  organizations. 

THE  organization  of  fanners  in  tlie  United  States  is  pro- 
ceeding on  lines  materially  different  from  those  in 
whicli  it  is  proceeding  elsewhere,  but  it  must  not  be 
supposed  that  the  causes  which  are  forcing  farmers  together 
in  the  United  States  are  not  equally  strong  elsewhere.  The 
details  of  the  working  of  the  societies  of  farmers  are  difficult 
to  obtain.  Publications  of  such  societies  in  this  country  have 
hitherto  been  largely  rhetorical  in  their  character  and  often 
give  a  better  idea  of  what  the  members  think  ought  to  be 
done,  than  of  what  they  are  actually  doing.  There  is  naturally 
some  lack  of  statistical  skill,  and  more  lack  of  money  to  pay 
for  printing.  The  daily  press,  the  great  purveyor  of  news, 
seldom  deals  with  the  subject.  The  farmers  of  all  nations, 
however,  are  beginning  to  organize,  each  according  to  the 
national  character,  and  the'circumstances  of  the  people.  If  we 
knew  nothing  of  the  actual  facts,  we  should  still  know  that 
organization  is  in  progress,  or  will  soon  begin  among  the 
farmers  of  all  civilized  nations,  because  we  know  that  every- 
where the  forces  are  at  work  which  compel  organization. 
We  also  may  know  that  whatever  form  organization  may  take 
among  the  farmers  of  any  country,  it  will  be  very  uneven  in 
its  progress.  It  may  sweep  like  wild-fire  over  a  certain  district 
for  a  season,  and  in  a  year  or  two  there  may  be  hardly  a 
visible  sign  of  organization.  It  is  certain,  however,  that  the 
})rocess  is  going  on  among  farmers,  as  among  other  classes. 
There  are  no  reliable  statistics,  for  there  is  a  constant  succes- 
sion  of  societies   organizing  and  disbanding.*     A  few  years 


*0f  ii  list  of  fanners'  marketing  societies  of  California,  compiled  by  myself, 
some  three  years  since,  for  the  U.  S.  Interstate  Commerce  Commission,  nearly 
half  were  out  of  existence  before  the  list  was  published,  and  yet  the  volume  of 
Cdoperative  business  done  in  tliat  state  was  last  year  larger,  probably  by  a 
million  dollars,  tlian  in  any  previous  year. 
(284) 


SOME  farmers'  organizations.  285 

since  the  number  of  farmers'  purchasing  organizations  in 
France  was  said  to  exceed  six  thousand.  A  year  or  two  later 
they  were  reported  to  have  greatly  fallen  off  in  number. 
In  northern  Europe  the  farmers'  organizations  are  mainly 
connected  with  dairying.  In  Germany  their  most  prominent 
form  seems  to  have  been  that  of  associations — not  comj)Osed 
entirely  of  farmers — for  borrowing  money  at  low  rates.  In  all 
these  countries  the  governments  exercise  some  control.  In  Ire- 
land, cooperation  among  the  peasantry  is  being  systematically 
promoted  by  altruistic  methods.  In  England  there  have  been 
similar  efforts  less  successful.  These  general  statements  may 
give  some  idea  of  the  manner  in  which  similar  causes  are 
everywhere  tending  to  produce  similar  results.  While  few 
reliable  statistics — official  or  unofhcial — are  attainable,  it  is 
possible  for  all  governments,  when  taking  a  census,  to  ascer- 
tain the  volume  of  cooperative  business  done,  and  the  total 
membership  of  farmers'  societies.  A  comparison  of  the  figures 
with  those  of  the  same  schedule  of  the  following  census  would 
show  very  clearly  the  trend  of  rural  society. 

The  organization  of  farmers  in  the  United  States  has  pro- 
ceeded upon  lines  peculiar  to  this  country.  Its  most  promi- 
nent feature  has  been  the  use  of  the  fraternal  principle  in  the 
organization  of  friendly  societies,  usually  having  a  secret  ritual, 
and  invariably,  I  think,  open  to  men,  women,  and  youths. 

Of  these  societies  the  oldest  and  most  influential  is  the 
secret*  order  of  Patrons  of  Husbandry,  commonly  known  as 
the  "Grange."  This  society,  so  far  as  I  know,  was  the  first 
society  of  farmers  to  be  planned  and  organized  on  a  national 
scale,  as  it  was  also  the  first  secret  society  to  admit  women  to 
full  membership  upon  equal  terms  with  men.  It  was  organ- 
ized, in  1866,  by  conservative  men,  of  broad   views,  for  the 


*  Secret  mainly  in  the  sense  that  it  has  a  secret  ritual,  not  guarded  with 
much  care,  and  "  passwords  "  changed  at  regular  intervals.  There  is  an  eco- 
nomic reason  for  this  in  that  it  is  practically  tiie  only  method  by  which  the 
trifling  dues  required  for  little  expenses  can  be  regularly  collected.  The  same 
may  be  said  of  other  farmers'  so-called  secret  societies.  It  may  be  proper  to 
say  that  I  am  a  member  of  the  Grange,  and  for  a  short  time  belonged  to  the 
Farmers'  Alliance. 


286  Tli;^    FARMER    AS    A    COOPERATOR. 

time,  and  was  designed  to  be,  as  in  the  main  it  has  finally 
become,  simply  a  fraternal  society  for  enriching  the  social  life 
of  rural  people,  broadening  their  views  of  economic  questions, 
and  uniting  them  in  all  efforts  for  the  local,  state,  and  national 
welfare.  It  is,  and  always  has  been,  kept  strictly  non-partisan 
in  political  matters,  cariying  the  rule,  possibly,  to  extremes  in 
discouraging,  in  the  Granges,  discussion  even  on  some  vital 
economic  topics — such,  for  examj)le,  as  the  tariff — on  which 
the  people  are  divided  sharply  by  party  lines.  While  this 
extreme  care  sometimes  appears  unfortunate  in  preventing 
temperate  discussion  of  such  sulyects  in  subordinate  Granges, 
it  probably,  after  all,  has  been  the  main  source  of  strength  of 
the  Order,  and  is  its  strongest  assurance  of  permanence.  It  is 
being  constantly  made  manifest  tliat  in  this  country,  at  least, 
any  endeavor  to  exert  political  influence  by  tlie  control  of 
party  organization,  will  result,  if  persisted  in,  in  the  death  of 
the  secret  society  attempting  it. 

While  the  Grange  was  organized  by  conservative  men, 
substantially  on  the  lines  as  above  set  forth,  it  would  have 
been  impossible,  at  that  time,  for  the  order  to  have  lived  on 
those  lines.  In  very  few  communities,  at  that  time,  would  it 
have  been  possible  to  have  secured  the  regular  attendance  of 
farmers  in  assemblies  for  recreation  and  mutual  improvement. 
The  order  struggled  along,  and  was  apparently  about  to  die, 
until  tlie  organizing  force  reached  tlie  central  Mississippi 
Valley.  They  found  there,  among  the  farmers,  a  condition 
of  social  discontent  which  was  particularly  favorable  to  the 
spread  of  a  new  order  whose  object  was  the  removal  of 
the  ills  of  the  farmer.  The  order  as  it  existed,  however,  did 
not  answer  the  purpose.  A  proposal  to  study  the  causes  of 
evil  did  not  appeal  strongly  to  those  who  wished  to  remove 
the  evils  first  and  discuss  them  later.  Energetic  men  of  the 
west  saw,  as  they  thought,  in  the  Grange,  the  means  of  an 
immediate  reconstruction  of  rural  society  by  the  abolition  of 
the  middleman.  The  principle  of  buying  together  and  selling 
together  was  engrafted  on  the  order,  and  made  its  chief  corner- 
stone. This  was  wholly  against  the  judgment  of  the  founders, 
and  only  accepted  by  them  because  the  only  alternative  was 


SOME  farmers'  organizations.  287 

evidently  tlie  deatli  of  the  order,  involving  not  only  the  morti- 
liccilion  of  failure,  but  serious  pecuniary  loss  to  some  who  had 
advanced  money  for  the  expenses  of  starting  it.  Under  the 
stimulus  of  the  new  idea  the  Grange  began  to  grow  and 
speedily  overrun  all  the  northern  states.  As  it  grew,  coopera- 
tive stores  were  established  everywhere,  as  well  as  manufac- 
turing and  other  business  enterprises.  Nearly  all  these  were 
in  the  liands  of  men  entirely  unskilled  in  the  business  which 
they  were  to  conduct,  and  to  a  very  large  extent  were  es- 
tablished and  carried  on  upon  credit.  Cora})lete  failure,  of 
course,  was  the  inevitable  result  in  nearly  every  case,  involv- 
ing great  individual  losses,  and  very  nearly  the  death  of  the 
order. 

But,  while  carrying  out  the  principles  of  cooperative  trad- 
ing, the  Grange  also  took  up  the  doctrine  of  the  control  of  the 
railroads  by  government  authority.  Railroad  management 
in  those  days  was  entirely  arbitrary,  and  as  a  necessary  conse- 
quence, harsh  and  oppressive.  The  Grange  adopted  the  doc- 
trine that  the  state  had  the  right  to  regulate  fares  and  freight 
rates  on  all  railroads,  and  under  the  impulse  of  the  Grange 
movement,  and  mainly  by  the  influence  of  the  Grange,  state 
laws  were  passed  in  several  of  the  western  states,  prescribing 
maximum  rates  for  freight  and  passenger  service.  The  power 
to  do  anything  of  the  kind  was  disputed  by  the  railroads,  and 
the  cases  were  carried  to  the  Supreme  Court  of  the  United 
States.  The  Grange  won,  and  in  so  doing  established  forever 
tJje  inestimably  valuable  principle  that  no  quasi-public  corpo- 
ration can  escape  legitimate  regulation  by  the  authority  which 
created  it.  Of  course  this  doctrine,  being  sound  and  just,  was 
certain,  in  due  time,  to  be  recognized  and  established.  None 
the  less  is  credit  due  to  the  agency  by  which  the  work  was 
actually  done,  and  this  agency  was  the  Grange,  The  cases 
in  which  the  doctrine  was  finally  established  in  the  United 
States,  are  universally  known  and  referred  to  as  the  "Granger 
cases,"  and  constitute  the  first  grand  triumph  of  organized 
rural  society. 

This  great  political  triumph,  however,  did  not  come  in 
time  to  save  the  Grange  from  the  consequence  of  its  egregious 


288  THE    FARMER   AS    A    COOPER ATOR. 

economic  errors  in  attempting  to  do  business  without  capital 
and  without  experience.  As  a  result  of  its  failures  in  trade, 
and  tlie  widely-distributed  losses  whicli  followed,  the  Grange 
nearly  died.  Its  very  errors,  however,  had  been  its  salvation. 
Without  the  impetus  given  by  unfounded  hopes,  it  could  not, 
at  that  time,  have  acquired  the  strength  and  influence  which 
numbers  give.  Among  the  million  and  a  half  members 
whicli  the  order  at  one  time  possessed,  there  were  enough  who 
could  appreciate  the  value  of  the  original  conception,  or  who 
had  become  attached  to  it  by  the  ties  of  sentiment,  to  keep  it 
alive,  and,  although  its  membership  fell  off  and  the  majority 
of  subordinate  Granges  went  out  of  existence,  it  did  not  die. 
In  due  time  it  began  to  grow  again,  this  time  on  the  original 
conservative  lines,  until  to-day  it  is  far  more  useful  and  pow- 
erful than  ever,  and  seems  certain  to  continually  increase  its 
usefulness. 

The  Grange,  like  all  other  organizations,  has  just  so  much 
moral  force  as  there  is  reason  in  the  doctrines  whicli  it  avows. 
Its  effective  force  varies  with  the  character  of  its  membership. 
The  National  Grange  has  always  been  distinguished  for  the 
dignity  and  wisdom  of  its  published  deliverances.  Some 
State  Granges  have  consistently  sustained  this  character,  and 
some  have  not.  To  a  greater  degree  this  is  true  of  subordi- 
nate Granges.*  The  discipline  of  this  order,  however,  pre- 
vents its  name  from  being  used  in  furtherance  of  any  object 
of  national  importance  not  indorsed  by  the  National  Grange. 
A  subordinate  Grange  is  useful  in  local  affairs.  These  are 
usually  well  understood  by  the  membershij),  and  Grange 
influence  is  certain  to  be  used  wisely.  Whether  it  is  used 
effectively  depends  upon  the  executive  ability  of  the  member- 
ship. If  there  are,  in  any  subordinate  Grange,  a  number  of 
persons  who  know  how  to  make  things  happen,  it  will  be 
exceedingly  useful  to  the  community  in  which  it  exists.  The 
same   may  be  said  of  State  Granges  in   tiie   smaller  states, 

*  The  masters  of  State  Granges  are  of  course  elected  by  the  Grange.  These, 
with  their  wives  (or  husbands),  constitute  the  State  Grange.  The  masters  of 
the  State  Granges,  with  their  wives  (or  husbands),  make  up  the  National 
Grange.     The  National  Grange,  therefore,  is  a  very  select  body. 


SOME  farmers'  organizations.  289 

where  rural  interests  are  homogeneous,  and  where  a  compara- 
tively dense  population  conduces  to  large  and  regular  attend- 
ance, with  corresponding  opportunities  for  discussion  before 
action.  In  the  larger  and  newer  states,  in  wliich  rural 
interests  are  more  or  less  diverse,  where  there  is  less  inter- 
course between  farmers,  in  or  out  of  the  Grange,  and  where  a 
prevalent  speculative  spirit  has  warped  t])e  judgment  of  the 
people,  there  seems  less  ability  to  get  the  full  grasp  of  all  sides 
of  practical  economic  subjects,  wliich  is  an  essential  i)rcrequi- 
site  to  wise  decision.  In  the  nature  of  things  this  condition 
will  improve. 

The  presence  of  woman  in  the  Grange  is  of  the  utmost 
value.  Without  woman  it  is  quite  safe  to  say  there  could  be 
no  Grange.  They  bring  to  the  order  the  social  and  recreative 
element  of  which  rural  people  stand  in  most  need.  They 
have  not  always  the  training  or  the  temperament  suitable  for 
wise  discussion  of  economic  questions  which  directly  involve 
their  domestic  interests,  but  they  seldom  attempt  to  discuss 
them,  and  usually  vote  with  their  husbands.  But  they  keep 
the  Grange  in  existence,  which  men  alone  would  never  do. 
The  ritual  of  the  Grange  is  well  conceived  and  well  written. 
When  well  rendered  it  is  very  pleasing.  It  is  not  always  well 
rendered,  but  there  is  no  doubt  that  the  use  of  a  ritual,  and 
the  observance  of  the  little  ceremonies  which  are  used  in 
friendly  societies,  is  of  great  value  in  accustoming  those  whose 
environment  is  sometimes  rude,  to  the  trifling  courtesies  which 
make  social  intercourse  agreeable.  There  are  a  few  who  object 
to  the  Grange  because  of  its  "secrecy."  I  can  not,  myself, 
however,  understand  how  any  one  can  object  to  a  mere  promise 
not  to  tell  a  few  things  of  no  earthly  consequence  in  them'- 
selves, and  which  have  been  found  essential  to  the  permanence 
of  the  society.  There  is  no  record  of  the  survival  of  any 
important  society  of  farmers  for  promoting  local  and  general 
welfare,  except  upon  the  principle  of  "fraternity"  as  exempli- 
fied in  a  friendly  society.  The  friendly  society,  with  its  ritual, 
has  proved,  by  survival  in  many  forms,  that  it  is  adapted  to 
the  nature  of  mankind.  When  other  societies  of  general 
membership  are  formed,  they  die.  Farmers  must  probably 
19 


290  THE    FARMER    AS    A    COOPER ATOR. 

understand  that  their  choice  must  be  between  a  society  of  this 
kind  or  no  organization  for  educational  and  social  purposes. 

The  "Farmers'  Alliance  and  Industrial  Union,"  in  its 
present  form,  grew  out  of  the  amalgamation  of  a  number  of 
societies  of  farmers,*  which  grew  up  as  the  result  of  the  Grange 
movement.  They  w^ere  nearly  all,  I  think,  started  during  the 
wave  of  excitement  which  accompanied  the  triumphant  prog- 
ress of  the  Grange,  and,  in  the  main,  represented  the  most 
**  radical  "  element  of  the  farmers.  A  ''  radical "  is  one  who  has 
mastered  but  one  side  of  a  question. f  The  founders  of  all 
these  societies  were  very  much  in  earnest,  and  believed  that 
reforms  could  come,  in  a  free  country,  only  by  means  of 
political  action.  The  proposal  of  the  Farmers'  Alliance  and 
Industrial  Union,  therefore,  was  to  bring  pressure  to  bear  upon 
existing  political  parties,  and,  failing  of  results  there,  to  organ- 
ize a  political  party  of  their  own.  The  result,  as  is  well  known, 
was  the  organization  of  a  new  part}^  The  regulations  of  the 
Farmers'  Alliance  are  as  strictly  non-partisan  as  those  of  the 
Grange.  In  practice  it  was,  during  its  years  of  greatest  success, 
a  secret  political  organization. |  If,  as  was  seldom 'the  case, 
some  overscrupulous  member  objected  to  "political"  discus- 
sion, it  was  easy  to  close  the  meeting  of  the  "Alliance,"  open 


*  Among  these  were  the  "  Agricultural  Wheel,"  founded  about  1876;  the 
"Farmers'  Alliance,"  founded  in  1873;  another  "Farmers'  Alliance,"  founded 
in  Texas;  the  "Farmers'  Union,"  founded  in  1887;  and  perhaps  others.  A 
final  amalgamation  of  all  these  societies  was  eflPected  in  1889,  under  the  name  of 
the  "  Farmers'  Alliance  and  Industrial  Union."  At  one  time  its  membership 
was  said  to  be  nearly  3,000,000. 

f  There  are  at  least  two  sides  to  all  questions,  and  those  who  have  fully- 
comprehended  what  can  be  said  on  all  sides  of  a  subject,  are  apt  to  be  much  less 
positive  in  their  opinions  than  those  who  have  studied  but  one  side.  It  is  the 
radicals,  however,  who  are  the  cause  of  most  reforms.  They  usually  get  less 
than  they  ask,  because  they  ask  too  much,  but  it  is  their  work  which  gets  some- 
thing to  be  done. 

J  This  is  true  so  far  as  my  experience  goes.  I  have  always  made  it  a  rale  to 
"join  "  any  local  society  which  would  bring  the  neighbors  of  my  community 
together  for  any  purpose.  When  the  Alliance  fever  reached  us,  I  "joined  " 
with  the  rest.  There  was  nothing  in  its  declaration  of  principles  which  I  could 
not  approve.     I  did  not  approve  its  practice  as  it  then  was  in  our  state. 


SOME  farmers'  organizations.  291 

the  doors,  and  proceed  with  the  discussion  of  what  really 
interested  those  present.  The  Farmers'  Alliance  has  been,  and 
should  continue  to  be,  a  very  useful  body.  It  has  manifested 
far  more  energy  than  the  Grange  has  of  late  years,  resembling 
the  Grange  in  its  early  days,  when  it  was  marching  from  one 
victory  to  another.  Its  tendency  must  be  to  lose  some  of  its 
effective  force  as  its  members  become  more  familiar  with  the 
difficulties  attending  some  of  the  subjects  with  which  it  deals. 
It  has  created  a  national  party,  to  which  most  of  its  members 
probably  belong.  It  has,  however,  lost  its  initial  enthusiasm, 
which  it  can  never  regain.  Its  membersliip  has  fallen  off,  just 
as  that  of  the  Grange  fell  off,  after  its  first  flush  of  success.  In 
the  case  of  the  Alliance  there  was  the  additional  disadvantage 
of  its  dealings  whh.  practical  politics,  which  will,  and  should 
destroy  any  secret  society.  It  is  probable  that  this  is  now 
disappearing  from  the  meetings  of  the  Alliances.  But  where 
it  has  a  hold,  its  organization  should  be  maintained.  While  I 
am  unable  to  accept  all  the  economic  theories  of  the  Alliance, 
I  fully  recognize  the  value  of  the  social  and  educational  work 
w^hich  it  has  done,  and  may  do,  and  have  no  fear  of  the  outcome 
of  discussion.  If  the  more  radical  doctrines  of  the  Farmers' 
Alliance  are  right,  we  shall  all  of  us,  in  the  end,  become  con- 
vinced. If  they  are  wrong,  they  will,  in  the  end,  be  aban- 
doned by  those  who  now  hold  them.  The  educational  and 
social  w^ork  of  the  Alliance  is  identical  with  that  of  the  Grange. 
Its  opportunities  for  useful  influence  in  local  affairs  are  also 
the  same  as  those  of  tiie  Grange,  and  are  as  certain  to  be  wisely 
used.  If  its  membership  can  become  satisfied  to  exert  their 
political  influence  wholly  through  other  channels,  its  doors 
will  become  open  to  those  who  differ  with  the  majority  of  the 
members  upon  some  things,  which  is  the  best  thing  which 
could  happen.  In  most  matters  the  Grange  and  the  Alliance 
can  heartily  work  together,  and  exert  their  combined  influence 
for  the  welfare  of  husbandry.  When  farmers  have  organized, 
they  should  never  let  go  their  organization. 

Farmers'  clubs  are  later  forms  of  organization,  differing 
from  the  ritualistic  societies  in  that  their  meetings  are  open, 
and  tha.t  no  particular   stress  is  laid   upon   the   principle  of 


292  THE    FARMER    AS    A    COOFERATOR. 

"fraternity,"  which  is  one  of  the  corner-stones  of  all  secret 
organizations.  There  can  be  no  question  of  the  effectiveness 
of  farmers'  clubs  as  educating  influences.  They  can  do  some 
things  to  better  advantage  than  any  secret  society.  It  seems 
difficult,  however,  to  devise  any  bond  of  union  by  which  their 
united  influence  can  be  exerted  in  state  and  national  affairs. 
Certainly  there  could  be  a  state  and  national  organization  of 
farmers'  clubs,  just  as  there  is  of  political  clubs,  but  the  lack 
of  any  rule  of  discipline  common  to  all  would  be  quite  sure  to 
result  in  efforts  to  commit  the  organization  to  action  on  con- 
troverted topics,  which  in  turn  would  lead  to  disruption. 
Tiie  freedom  of  the  meetings  of  the  clubs  would  render  this 
the  more  certain  to  be  attempted,  and  the  more  likely  to 
succeed.  If  this  rock  were  escaped  there  would  be  that  of  the 
lack  of  revenue.  No  society,  secret  or  non-secret,  can  make 
its  influence  felt  outside  the  circle  of  its  habitual  attendants, 
except  by  the  expenditure  of  money.  I  am  a  member  of  one 
farmers'  club,  and  familiar  with  several.  None  of  them  have 
any  revenue  of  consequence,  and  the  general  opinion  is  that 
any  serious  attempt  to  raise  it  from  the  membership  would 
merely  break  up  the  clubs.  Some  clubs  which  have  a  large 
nominal  membership  find  themselves  entirely  unable  to  con- 
tribute to  the  small  expenses  without  which  no  popular  move- 
ment can  make  any  progress.  The  early  meetings  of  farmers' 
clubs  are  likely  to  be  well  attended  and  interesting.  After 
a  time  the  regular  attendants  who  can  talk  or  write  have  said 
to  each  other  about  what  they  have  to  say;  there  is  no  ritual 
to  occupy  a  little  time;  no  "initiations"  to  prepare  for  and 
carry  through;  there  is  seldom  the  fraternal  feeling  which,  in 
a  hearty  rural  community,  is  apt  to  find  expression  in  the 
loaded  boards  of  the  "Harvest  Feast,"  which  invariably  brings 
out  the  membership;  there  are  no  "communications"  from 
superior  authorities  suggesting  discussion  or  action  for  the 
common  weal;  there  are  no  visits  from  state  or  national 
officers  to  renew  interest  and  inspire  to  effort.  In  the  absence 
of  all  these  tlie  tendency  is  for  tiie  attendance  at  farmers'  clubs 
to  gradually  fall  off,  until  the  local  press  no  longer  deems 
them  worthy  of  attention,  for  dues  to  become  delinquent,  and 


SOME    farmers'    <)K(iANIZATI()XS.  293 

the  club  to  pass  out  of  existence.  When  this  does  not  hapi)en 
it  is  usually  because  some  one  provides  work  to  do  in  wljich 
the  club  is  interested.  Some  local  improvement  or  business 
organization  fostered  and  promoted  by  a  club  will  maintain 
interest.  There  are  some  working  clubs.  They  are  more  apt 
than  secret  societies  to  provide  "club  rooms"  for  their  mem- 
bers, where  agricultural  books  and  papers  can  be  found  for 
reference,  and  where  farmers'  wives  and  daughters  can  rest 
and  "freshen  up"  after  a  dusty  ride  to  town.  Where  a  reve- 
nue can  be  had  for  the  purpose — and  it  takes  very  little — the 
club  is  likely  to  become  a  valuable  center  of  influence.  It  is 
a  valuable  form  of  organization,  doubtless  capable  of  accom- 
plishing anything  which  a  friendly  society  can  accomplish, 
but,  considering  the  notions  of  mankind,  and  especially  farm- 
ers, perhaps  not  so  likely  to  do  so.  It  will  depend  upon  the 
community,  but  I  think  there  are  many  more  rural  commu- 
nities that  can  permanently  sustain  a  Grange  or  an  Alliance 
than  will  be  found  to  keep  up  an  effective  farmers'  club. 

The  foregoing  covers  the  forms  of  farmers'  organizations 
other  than  those  for  actually  transacting  business,  that  are 
most  common  in  the  United  States.  Business  organizations  of 
farmers  include  marketing  societies,  cooperative  creameries, 
irrigating  companies,  and  doubtless  other  business  organiza- 
tions* which  have  not  come  under  my  observation.  The 
principles  which  should  govern  the  formation  and  manage- 
ment of  these  companies  have  been  suflSciently  discussed  in 
the  preceding  chapters  of  this  book. 


*In  1898  the  U.  S.  Department  of  Agriculture  undertook  to  get  a  list  of 
cooperative  societies  of  farmers  in  the  United  States.  The  list  has  not  been 
published,  as  I  write,  but  I  collected  the  data  for  the  State  of  California,  and, 
excluding  those  which  gave  no  promise  of  permanence,  I  reported  seventy  irri- 
gating companies,  thirty-two  marketing  societies,  three  milling  companies,  four 
tire  insurance  companies,  and  t«n  organized  for  other  purposes.  A  large  num- 
ber ©f  cooperative  creameries  have  been  organized  in  the  state,  but  it  was  not 
found  possible,  except  by  a  personal  visit  to  each  one,  to  determine  how  many 
were  still  adhering  to  the  cooperative  plan.  The  list  of  societies  reported 
was  incomplete,  and  of  the  marketing  societies  reported  two  were  central  organ- 
izations representing  twelve  or  fifteen  local  societies,  all  of  considerable  mag- 
nitude. At  the  present  time  there  are  about  fifty  marketing  societies  in  opera- 
tion in  California. 


BOOK    SIXTH.* 

The  Questions  of  the  Day, 


CHAPTER   I. 

THE  FARMER  AND  THE  TARIFF. 

A  TARIFF  Oil  merchandise  imported  into  a  country  is  pre- 
sumed to  be  primarily  a  means  of  raising  a  national 
revenue.  In  that  aspect,  liowever,  it  is  by  no  means  a 
"question  of  the  day."  Practically  all  parties  in  the  Uuited 
States  have  agreed  to  regard  a  tax  on  imports  as  an  important 
if  not  the  principal  source  of  revenue  for  the  national  govern- 
ment. The  question  upon  which  the  people  are  divided  is  as  to 
the  policy  to  be  pursued  in  forming  the  tariff;  the  extremists 
of  one  party  insist  that  the  tariff  should  be  arranged  solely 
with  reference  to  producing  the  necessary  revenue  with  the 
least  possible  disturbance  to  business,  the  tax  being  made  as 
nearly  uniform  as  possible  upon  all  goods  imported,  or  if  any 
are  taxed  more  than  others,  such  articles  to  be  those  not  pro- 
duced in  this  country.  The  extremists  upon  the  other  side 
insist  that  in  framing  the  tariff  the  items  should  be  carefully 
examined  one  by  one,  and  such  tax  imposed  on  commodities 
which  can  be  produced  here  as  shall  as  nearly  as  possible  pre- 
vent their  importation,  only  enough  import  trade  in  such  goods 
being  left  to  supply  the  necessary  revenue,  and  that  no  article 
which  can  not  be  produced  in  this  country  shall  be  taxed  at 
all,  except  in  time  of  war.     Between  these  extremes  there  is 


*  See  Appendix  G  for  documents  relating  to  the  subjects  of  tiiis  book. 
(294) 


THE  FARMER  AND  THE  TARIFF.  2$).") 

every  conceivable  shade  of  opinion.  The  intent  of  this  chap- 
ter is  to  make  the  clearest  possible  statement  of  the  reasons 
urged  by  each  party  to  this  controversy  in  support  of  its  views. 
Extremists  are  more  likely  to  be  logical  than  compromisers, 
and  it  is  believed  that  by  a  clear  statement  of  the  arguments 
of  the  extremists  upon  both  sides,  the  reader  will  be  best 
prepared  to  understand  for  himself  the  merits  of  the  innum- 
erable compromise  measures  which  from  time  to  time  are 
proposed.  Neither  party  in  this  country  has  ever  been  able  to 
pass,  or  at  least  to  long  maintain  upon  the  statute-book,  a  tariff 
act  logically  constructed  according  to  the  theory  of  the  most 
clear-headed  of  the  party.*  In  fact,  the  views  of  such  men 
seldom  find  expression  in  party  platforms,  which  are  always 
drawn  up  by  "  practical"  men,  with  the  view,  not  of  ie- 
claring  economic  truth,  but  of  carrying  elections.  As  a 
rule,  therefore,  such  platforms  are  capable  of  two  or  more 
meanings,  in  order  that  in  each  section  of  the  country  that 
meaning  may  be  applied  by  political  orators  which  seems 
most  likely  to  win  votes.  The  exceptions  to  this  rule  are 
too  few  to  be  worth  considering,  which  relieves  me  from  the 
necessity  of  any  further  reference  to  political  declarations 
upon  the  subject  of  the  tariff. 

Before  taking  up  the  main  topic  it  will  be  useful  to  devote 
a  little  time  to  the  general  subject  of  taxation,  of  which  a  tariff 
act  forms  only  a  part.  The  American  citizen  pays  taxes  for 
the  support  of  at  least  three  and  usually  four  or  more  diff'erent 
governments;  in  all  cases  he  contributes  to  the  national,  state, 
and  some  local  government,  and  usually  to  more  than  one  local 
subdivision,  as  county,  town,  city,  school  district,  road  district, 
irrigation  district,  or  the  like.  Assuming  an  equal  per  capita 
division  of  taxes,  and  five  inhabitants  to  one  taxpayer,  the 
taxpayers  of  San  Francisco,  for  example,  contributed,  for  the 
fiscal  year  ending  June  30,  1897,  per  capita,  to  the  United 
States,  $23.75  ;  to  the  State  of  California,  $27.35  ;  to  the  city  of 


*  The  Morrill  tariff  act  of  1861  was  possibly  an  exception  to  this  rule,  and 
in  the  main  it  stood  for  many  years.  But  it  was  originally  passed  as  a  war 
revenue  measure. 


296  THE    QUESTIONS    OF    THE    DAY. 

San  Francisco,  $56.20 ;  total  per  taxpayer,  $107.30.  -  The 
amounts  paid  were  $1,520,000,  $1,752,250,  and  $3,599,785 
respectively.  The  population  of 'the  United  States  is  assumed 
to  have  been  seventy-three  milHon,  and  that  of  San  Francisco, 
three  hundred  and  twenty  thousand.  In  this  case  the  city 
absorbs  all  local  taxes.  The  aggregate  of  taxation  is  very 
serious  and  tends  to  increase. 

Taxation  is  coexistent  with  civilization,  and  from  time 
immemorial  the  devising  of  a  just  method  of  assessing  taxes 
has  been  tlie  most  difficult  problem  of  statesmansliip.  It  has 
never  been  solved  and  probably  never  will  be.  It  is  perfectly 
safe  to  say  that  no  entirely  just  tax  was  ever  yet  assessed  and 
collected.  It  is  the  most  intricate  and  puzzling  of  all  problems. 
Even  if  we  assume  that  whatever  is  logically  just  can  be 
})ractically  carried  out — which  is  not  true — it  seems  impossible 
to  make  any  single  statement  of  principle  which  w^ill  be  true 
without  modification.  It  is  not  even  true  that  men  should  pay 
entirely  according  to  their  ability,  for  nearl}'  all  agree  that  those 
who  indulge  in  such  articles  as  spirits,  tobacco,  opium,  and 
the  like  should  pay  in  extra  taxation  for  their  indulgence, 
and  there  are  many  who  believe  that  those  who  withhold  from 
others  who  would  use  it,  land  or  water  which  they  do  not 
themselves  use,  should  pay  extra  taxes  as  a  compensation.  The 
principle  adopted  in  all  highly-taxed  countries  is  to  closely 
scrutinize  every  industry,  and  place  upon  it  whatever  burden 
it  can  bear  without  being  destroyed,  or  if  not  necessary  to  go 
to  that  extreme,  whatever  it  should  fairly  pay  as  compared 
with  other  industries,  its  income-producing  power  being  the 
main  factor  considered.  To  the  sums  obtained  in  this  way  are 
added  the  proceeds  of  taxation  of  unproductive  property  used 
for  purposes  of  luxury,  and  upon  commodities  whose  use  it  is 
desired  to  discourage.  In  highly-taxed  countries  it  is  abso- 
lutely necessary  to  pay  strict  attention  to  the  income-producing 
power  of  the  different  industries,  as  otherwise  there  will  be 
taxes  which  can  not  be  paid. 

There  has  hitherto  not  been  sufficient  pressure  of  poverty  in 
the  United  States  to  compel  any  adequate  study  of  methods  of 
taxation.     While  taxes,  especially  local  taxes,  have  often  been 


THE    FARMER   AND   THE   TARIFF.  297 

high  and  very  unjust  in  their  assessment,  the  public  has  been 
able  to  meet  tliem  without  great  distress,  and  has  done  so. 
All  state  and  local  revenue  has  been  raised  by  assessing  sucli 
tangible  property  as  could  be  found  at  a  valuation  fixed 
according  to  the  judgment  of  local  assessors,  supplemented  by 
the  proceeds  of  licenses  for  transacting  business.  Much  rural 
property  has  been  assessed  relatively  higher  than  its  income- 
producing  power  would  justify,  and  practically  all  rural  prop- 
erty in  well-peopled  farming  communities  is  listed,  while 
personal  property  in  cities  has  often  been  assessed  at  relatively 
low  rates,  and  much  has  escaped  altogether.  Our  system  of 
state  and  local  taxation  is  unjust  to  farmers,  and  will  be 
further  described  in  a  later  chapter.* 

Previous  to  the  War  of  the  Rebellion,  our  entire  national 
revenue  had  for  a  long  time  been  produced  by  duties  on  im- 
ports. In  some  countries  duties  are  collected  on  exports. 
These  are  forbidden  by  the  Constitution  of  the  United  States, 
and  are  gradually  disappearing  from  the  fiscal  systems  of  all 
nations.  They  are  possible  only  in  the  case  of  commodities 
whose  production  is  confined  to  a  few  countries,  and  for  which 
the  demand  is  greater  than  the  supply.  Brazil,  for  example, 
has  hitherto  levied  an  export  tax  on  coff'ee.  When  comjieti- 
tion  is  active  between  difi'erent  countries  in  regard  to  a  com- 
modity, an  export  tax  operates  to  restrict  or  suspend  exporta- 
tion, and  divert  the  trade  to  competing  countries.  As  great 
competition  between  countries  now  exists  with  respect  to 
nearly  all  commodities,  exi)ort  taxes  are  likely  to  soon  be  a 
thing  of  the  past.  As  levied  in  colonial  times  by  Great 
Britain  in  some  of  the  colonies  they  were  regarded  as  oppress- 
ive, and  were  therefore  forbidden  by  the  Constitution  of  the 
United  States. 

Upon  the  breaking  out  of  the  Civil  War  national  neces- 
sities required  a  great  increase  in  our  revenue  which  import 
duties  could  not  supply,  and  Congress  was  compelled  to  impose 
taxes  on  all  commodities  and  all  business  transactions  from 
which  taxes  could  be  collected  without  too  great  cost.     After 


*See  Chapter  III  of  this  book. 


298  THE    QUESTIONS    OF    THE    DAY. 

the  close  of  that  war  nearly  all  these  taxes  were  gradually 
withdrawn,  those  on  beer,  spirits,  tobacco,  opium,  playing 
cards,  and  imported  wine  being  all  that  remained*  of  our  sys- 
tem of  national  internal  taxation.  Upon  the  outbreak  of  the 
war  with  Spain  some  of  these  taxes  were  reimposed,  and  will 
necessarily  remain  until  the  cost  of  that  war  is  paid  off.  It 
is  not  likely  that  the  nation  will  ever  again  dispense  entirely 
with  revenue  from  internal  sources,  as,  even  if  we  remain  in 
profound  peace,  the  tendency  is  for  the  people  to  demand  an 
ever-increasing  service  from  the  national  government.  While 
we  are  the  richest  nation  in  the  world  we  have  less  capital  in 
proportion  to  our  requirements  than  many  other  nations.  We 
have  an  immense  territory  whose  inhabitants  are  clamoring 
for  rapid  development.  We  might  be  called  "  land  poor."  We 
are  called  to  expend  for  pubhc  buildings,  rivers  and  harbors,  the 
conservation  of  forests,  the  control  and  storage  of  waters  and 
similar  objects,  within  a  short  time,  sums  whose  collection  and 
expenditure  would,  in  older  countries,  have  been  distributed 
over  centuries.  We  are  expending  for  these  purposes  the 
money  which,  but  for  our  happy  situation  and  hitherto  con- 
servative policy,  would  have  been  required  for  the  support  of 
a  great  standing  army.  In  the  event  of  war,  or  important 
increase  of  national  debt  from  other  causes,  national  taxation 
would  be  imposed  on  many  commodities  and  transactions 
which  are  now  untaxed. 

It  will  be  noticed  that  the  most  important  national  taxes 
are  what  are  known  as  "indirect  taxes"— that  is,  taxes  which 
are  collected  by  the  government  from  merchants  or  manufac- 
turers, with  the  expectation  that  they  will  repay  themselves 
when  selling  to  tlie  consumer.  This  is  because  the  resources 
of  direct  taxation  are  so  fully  used  for  state  and  local  purposes 
that  public  sentiment  requires  that  the  national  government 
shall,  so  far  as  possible,  be  restricted  to  indirect  taxation  as  a 


*Such  taxes  as  those  upon  "  filled  cheese  "  and  oleomargarine  are  not  meas- 
ures for  producing  revenue,  but  for  controlling  or  preventing  the  manufacture 
or  sale  of  products  deemed  undesirable.  I,  thereft)ro,  do  not  mention  them  in 
the  text. 


THE    FARMER    AND    THE   TARIFF.  299 

source  of  revenue.  The  Constitution  requires  that  all  direct 
taxes— which  include  income  taxes— should  be  apportioned  to 
states  according  to  their  population.  As  the  ability  of  states 
to  pay  is  by  no  means  according  to  their  population  the  tax  is 
too  obviously  unjust  to  be  levied.  During  the  Civil  War  such 
a  tax  was  imposed,  and  collected  from  some  states,  but  the  sums 
so  raised  were  repaid  to  the  states,  the  tax  being  recognized  as 
unfair.  Subsequently  an  income  tax  law  was  passed,  which 
the  Supreme  Court  held  to  be  a  direct  tax  and,  therefore, 
unconstitutional  and  void.  We  can  have  no  national  income 
or  other  direct  tax  without  an  amendment  to  the  Constitution 
of  the  United  States. 

It  is  obvious  that  indirect  taxes  are  in  one  way  very 
undesirable,  as  the  consumer  pays  much  more  than  the 
government  receives,  the  tax  paid  by  the  importer  and 
manufacturer  being  treated  as  part  of  the  cost  of  the  product 
and  paying  a  profit  to  all  who  handle  the  goods,  the  tax  with 
profits  added  being  finally  paid  by  consumer.  While  profits 
vary  greatly  in  different  lines  of  business,  we  may  say, 
roughly,  that  the  profit  to  the  importer,  is  twenty-five  per 
cent,  to  the  jobber  ten  per  cent,  and  to  the  retailer  twenty-five 
per  cent,  out  of  wdiich  must  come  their  expenses.  If,  then, 
an  importer  pays  on  a  certain  lot  of  goods  an  import  tax  of 
$100,  he  collects  from  the  jobber  $125;  when  the  jobber  sells 
the  goods  he  adds  to  the  tax  which  he  has  paid  $12.50, 
making  $137.50,  to  which  the  retailer  in  turn  adds  $34.88, 
making  $171.88,  which  the  consumer  pays  in  taxes  in  order 
that  the  government  may  get  $100.  Sometimes  it  would  be 
more,  and  in  other  cases  less,  depending  upon  the  nature  of 
the  goods  and  the  stress  of  competition,  but  the  range  of 
profits  given  is  about  what  is  necessary  to  pay  the  expense 
of  the  purchase  and  distribution  of  commodities,  with  a 
reasonable  profit.  On  such  staple  goods  as  sugar,  tea,  and 
coff'ee,  the  profits  are  much  less,  and  on  some  other  classes  of 
products  they  are  greater. 

These  facts,  which  of  course  are  well  understood  by 
legislators  and  economists,  have  led  many  to  insist  that  all 
taxes  should  be  so  levied  that  the  one  who  ultimately  pays  the 


300  THE   QUESTIONS   OF   THE   DAY. 

tax  shall  pay  it  directly  to  the  government,  and  save  any 
intermediate  profit,  but  this  is  a  matter  often  hard  to  deter- 
mine; the  real  incidence  of  taxation  is  a  vexed  question  in 
economics,  and  while  in  the  main  authorities  seem  to  agree 
that  the  "consumers"  pay  nearly  all  taxes  except  those  on 
fixed  incomes,  yet  sometimes  they  do  not.  The  fact  is  that 
whoever  pays  a  tax  does  his  best  to  pass  it  on  to  some 
one  else  by  adding  it  to  the  price  of  some  commodity  or  use, 
but  sometimes  does  not  succeed.  That  it  always  in  the  end 
falls  upon  the  weakest  is  about  the  only  general  statement 
that  seems  to  me  entirely  truthful,  and  tlie  weakest  is  most 
likely  to  be  the  consumer.  Sometimes,  however,  he  is  not. 
A  very  weak  consumer  who  can  keep  his  head  is  often  stronger 
in  a  bargain  than  either  of  two  much  stronger  men  who  are 
competing  with  each  other  for  his  trade.* 

But,  aside  from  the  difficulty  which  exists  in  locating  the 
real  taxpayer,  there  are  considerations  which  favor  the  indirect 
tax.  The  loss  to  the  taxpayer  by  the  profit  of  the  middle- 
man is  less  than  it  seems,  for  the  taxpayer  must  pay  the  cost 
of  collection,  and  it  costs  much  less  to  collect  from  a  few- 
importers  or  manufacturers  than  from  the  entire  community. 
Individuals  can  entirely  escape  taxation  by  refraining  from 
the  use  of  taxed  commodities.  Except  sugar,  no  important 
article  of  prime  necessity  is  now  the  object  of  indirect  taxation 


*  In  the  case  of  articles  or  brands  not  produced  in  this  country,  as  tea  and 
Wostenholm  knives,  it  seems  evident  that  the  consumer  pays  all  the  tax,  and 
yet  even  in  this  case  the  competition  of  coffee,  or  of  other  brands  of  knives, 
might  compel  the  producer  to  sacrifice  some  part  of  his  profit,  which  would  be 
equivalent  to  paying  a  part  of  the  tax.  In  the  case  of  products  which  we 
export  largely,  as  wheat,  it  seems  evident  that  the  foreign  producer  must  pay  all 
the  tax.  Some  wheat  is  sent  from  Manitoba  to  Minneapolis,  and  there  ground, 
presumably  because  the  freight  to  Minneapolis,  and  the  duty,  are  less  than  the 
freight  to  a  Canadian  port.  While  one  would  think  that  in  this  case  the 
Canadian  producer  must  pay  the  duty,  yet  it  is  quite  conceivable  that  the 
railroads,  for  the  sake  of  the  traffic,  might  so  reduce  their  freight  rates  as  to 
practically  pay  part  of  it.  The  subject  does  not  seem  to  mo  profitable  for 
popular  discussion,  as  each  alleged  case  must  be  examined  upon  its  own  merits. 
The  statement  in  the  text  seems  to  me  the  best  general  statement  that  can 
be   made. 


THE   FARMER    AND    THE    TARIFF.  301 

in  the  United  States.*  The  taxpayer  is  also  enabled  to  pay- 
in  small  and  even  trifling  instalments  as  he  buys  liis  supplies 
from  day  to  day,  a  privilege  which  must  always  be  paid  for  in 
some  way,  and  by  many  is  considered  worth  all  it  costs.  By 
timing  his  purchases  to  suit  other  contingencies  he  can  in  a 
great  measure  select  liis  time  of  payment  of  such  taxes  as  he 
elects  to  pay  at  all,  a  privilege  also  worth  paying  for.  These 
considerations  have  more  or  less  weight,  even  from  the  stand- 
point of  the  economists,  in  favor  of  indirect  taxation.  The 
thing,  however,  which  possibly  has  greater  weight  with  leg- 
islators than  all  others,  is  the  fact  that  by  indirect  taxation 
the  people  pay  taxes  and  do  not  know  it,  and  therefore  endure 
a  rate  of  taxation  which  would  excite  grave  discontent  if  paid 
openly,  and  at  one  certain  time,  and  under  compulsion.  On 
the  other  hand,  there  are  thoughtful  men  who  believe  this  the 
greatest  evil  connected  with  indirect  taxation.  If  the  sums 
paid  by  the  people  for  the  public  service  were  more  forcibly 
brought  home  to  them  they  would  compel  greater  economy  in 
public  affairs. 


While  upon  nearly  all  the  above  matters  there  are  honest 
differences  of  opinion  among  economists  and  the  public,  none 
of  them  are  the  subjects  of  partisan  controversy  in  the  United 
States,  although  upon  some  of  them.  Congress  may  at  any 
time  happen  to  divide  upon  party  lines.  But  they  do  not 
enter  into  party  platforms,  or  form  the  subjects  of  active  polit- 
ical controversy. 

The  protection  of  home  industries,  however,  by  means  of  a 
tariff  on  competing  imports,  irres})ective  of  the  necessity  of 
revenue,  has  been  the  subject  of  political  controversy  in  the 
United  States  from  the  foundation  of  our  government.  All 
persons  having  occasion  to  buy  commodities,  desire  the  prices 


*0f  course  the  prices  of  many  important  articles  of  domestic  origin  are 
raised  by  the  indirect  taxation  of  competing  products,  but  there  can  be  no 
brief  popular  exposition  of  economic  doctrine  if  every  statement  is  safeguarded 
by  exceptions.     Each  subject  would  require  a  book. 


302    -  '  THE    QUESTIONS    OF   THE    DAY. 

of  them  to  be  low,  and  will  bu}^  where  they  can  buy  cheapest. 
What  we  should  all  really  prefer  is  free  trade  in  what  we  have 
to  buy,  and  a  stiff  protective  tariff  on  whatever  we  have  to  sell. 
Some  of  us  are  so  situated  that  what  we  have  to  sell  is  not 
affected  by  foreign  competition,  and  so  long  as  we  remain  in 
that  condition  we  tend  to  be  free  traders;  others  of  us  produce 
goods  with  which  foreign  commodities  compete,  and  so  tend 
to  become  protectionists.  If  our  occupations  or  the  conditions 
affecting  them  change,  we  gradually  but  surely  tend  to  change 
our  opinions;  unconsciously,  and  in  entire  good  faith,  we 
permit  our  interests  to  control  our  convictions.  From  the 
standpoint  of  economics  this  is  exactly  as  it  should  be;  inter- 
ests will  differ,  and  we  should  quickest  reach  the  greatest  good 
of  the  greatest  number  if  upon  economic  subjects  each  indi- 
vidual voted  in  accordance  with  his  real  interests.  It  has 
happened  sometimes  in  our  history  that  individuals  whose 
productions  were  not  affected  by  foreign  competition  were 
closely  grouped  in  one  section  of  the  country,  while  those 
whose  products  could  not  compete  in  price  in  the  home 
market  were  grouped  in  some  other  section.  This  resulted  in 
sectional  differences  of  interest,  which  are  always  unfortunate, 
and,  if  permanent,  frequently  dangerous  to  the  stability  of 
government.  With  the  progress  of  the  country,  however, 
these  sectional  differences  tend  to  disappear.  New  industries 
become  established  in  districts  which  were  once  solidly 
devoted  to  a  single  industry,  and  while  individual  differences 
of  interest  and  opinion  remain,  their  sectional  and  conse- 
quently dangerous  character  is  gradually  disappearing. 

The  tariff  problem  in  the  United  States  has  always  been 
greatly  complicated  by  the  fact  that  all  parties  have  always 
been  agreed  in  regarding  a  tax  on  imports  as  a  principal 
source  of  national  revenue.  They  have  also  agreed  in  con- 
cluding that  the  necessary  revenue  could  not  be  raised  by  any 
reasonable  tax  on  commodities  not  produced  in  this  country, 
but  must  be  extended,  in  order  to  produce  the  necessary 
amount,  to  articles  which  we  also  produce.  But  any  tax  on 
imports,  no  matter  for  what  purpose  levied,  is  to  its  extent 
protective,  if  the  articles  so  taxed  are  produced  in  this  country. 


THK    l<'AKMKJt    AND    Til  JO    TARIFF.  o03 

The  rate  of  tax  which  the  ditrereiit  articles  can  properly  bear, 
considered  merely  as  objects  of  taxation,  and  the  rates  which 
will  produce  the  most  revenue  from  each,  are  matters  of  expert 
knowledge,  as  to  which  the  public  is  seldom  in  a  position  to 
judge.  All  interests  likely  to  be  taxed  are  alert  and  watchful 
to  induce  Congress  to  impose  the  highest  or  the  lowest  tax 
possible,  as  the  interests  of  the  opposing  parties  may  lie,  and 
it  is  seldom  possible  to  separate,  in  the  [)ublic  mind,  the 
revenue  question  involved  from  that  of  protection.  This  has 
made  the  way  easy  to  misrepresentations  on  all  sides  which 
the  public  is  unable  to  detect,  and  added  greatly  to  the  com- 
plexity of  the  questions  and  the  confusion  of  thought  attending 
their  discussion. 

Nearly  all  modern  economists  are  free  traders.  By  "econ- 
omists" is  understood  professional  men,  usually  connected  with 
universities,  who  devote  their  lives  to  a  search  for  economic 
truth,  and  usually  to  teaching  it  as  they  understand  it.  These 
gentlemen  usually  have  no  personal  pecuniary  interest  to  serve 
by  the  advocacy  of  either  side.  What  they  have  to  sell  is 
economic  science,  which  is  not  an  object  of  taxation,  and  can 
neither  be  helped  nor  hindered  by  "protection"  or  the  lack  of 
it.  Their  great  learning,  their  absence  of  bias,  and  their  high 
character  give  great  weight  to  their  opinions  among  thoughtful 
men,  and  they  are  entitled  to  the  highest  respect.  The  opinion 
of  this  class  of  economic  students  is  so  nearly  unanimous  and 
so  emphatic  on  this  subject  that  it  may  as  well  be  conceded 
— for  it  is  a  fact — that  economic  science  as  taught  in  univer- 
sities pronounces  against  the  doctrine  of  protection.  Nothing 
is  gained  by  belittling  these  men,  after  the  manner  of  the  pro- 
tective press  and  political  orators.  Ridicule  and  abuse  are 
signs  of  intellectual  defeat.  They  are  the  weapons  taken  up 
when  argument  fails.  Advocates  of  protection  will  stand  on 
stronger  ground  by  conceding  that  the  economists  who  oppose 
them  are  able  and  candid  men. 

Economists  of  this  class  reason  that  in  the  long  run  pro- 
duction will  be  most  abundant  and  economical,  and  com- 
merce most  profitable,  if  products  are  permitted  to  move 
entirely  unhampered  by  tariff  walls.     They  claim  this  to  be 


304  THE    QUESTIONS    OF    THE    DAY. 

self-evident,  and  that  economic  science,  regarding  the  "entire 
world,  can  never  approve  a  protective  tariff  which  is  intended 
to  benefit  one  nation  at  the  expense  of  others. 

I  am  not  aware  of  any  published  book  or  article  which 
squarely  grapples  with  these  propositions,  which,  indeed,  as 
claimed,  seem  almost  self-evident.  Men  would  indeed  seem 
to  produce  most  abundantly  and  economically  when  producing 
that  which  they  can  secure  most  readily.  Commerce,  like  a 
river,  would  indeed  seem  likely  to  move  most  freely  in  chan- 
nels wholly  free  from  obstruction.  Protectionists,  therefore, 
have  usually,  and  very  naturally,  directed  their  argument  to 
showing  the  advantages  of  the  system  to  the  particular  country 
for  which  tiiey  were  writing,  without  concerning  themselves 
as  to  whether  or  pot  the  advantages  thus  claimed  were  to  be 
gained  at  the  expense  of  other  nations,  or  with  protection  as 
a  fiscal  system  for  developing  the  entire  resources  of  the  world. 
To  these  fundamental  postulates  of  the  free  traders,  however,  it 
may  be  replied  as  follows:*  Unrestricted  free  trade  is  disastrous 
to  any  country,  for  the  reason  that  it  tends  to  premature  exhaus- 
tion of  its  natural  resources.  With  trade  entirely  unhampered, 
the  result  would  in  truth  be,  as  free-traders  claim,  that  all 
men  would  engage  in  those  industries  from  which  they  could 
obtain  the  quickest  and  most  profitable  results;  this  would  in 
all  cases  mean  the  exploitation  of  accumulated  stores  of  coal, 
timber,  iron,  and  other  minerals,  while  the  fertility  of  agricul- 
tural districts  would  be  rapidly  diminished  by  extensive  culti- 
vation, for  the  reason  that  food  products  will  not  bear  the  cost 
of  the  intensive  cultivation  essential  to  the  maintenance  of 
fertility,  in  addition  to  the  cost  of  transj)ortation  to  distant 
markets.  In  due  process  of  time  this  would  leave  all  nations 
shorn  of  what   had   been  their  greatest  strength,  and  with 


*For  all  but  the  language  of  tlie  remainder  of  this  paragraph,  I  am  indebted 
to  Mr.  John  P.  Young,  of  San  Francisco — probably  the  best  informed,  most 
logical,  and  most  uncompromising  Protectionist  now  living  in  America.  Mr. 
Young  has  been  kind  enough  to  read  the  proof  sheets  of  this  chapter,  and 
permits  me  in  the  above  paragraph,  to  anticipate  a  little  from  a  book  of  his 
own,  to  be  entitled  "  Protection  and  Progress,"  now  in  manuscript,  and  about 
to  1)6  published. 


THE    FARMER    AND    THE    TARIFF.  305 

greatly  impaired  powers  of  maintaining  their  commercial  and 
political  integrity.  On  the  contrary,  such  a  wise  applica- 
tion of  the  protective  principle  as  the  circumstances  of  each 
nation  will  suggest  to  its  statesmen,  will  maintain  the  natural 
resources  of  each  nation  in  equilibrium  within  itself,  tend  to 
better  cultivation  of  agricultural  districts  by  reason  of  the 
home  markets  which  render  it  possible,  and  to  a  longer  and 
more  useful  national  life  for  all  nations.  To  recur  to  the 
illustration  employed  in  behalf  of  the  free-trade  argument; 
while  it  is  true  that  the  river  will  flow  more  freely  if  left 
unobstructed,  it  is  only  by  damming  at  proper  places  that  it 
can  be  made  to  do  the  most  work  of  which  it  is  capable. 

The  usual  argument  for  a  protective  tariff  begins  by  deny- 
ing that  abstract  economic  truth  has  very  much  bearing 
upon  the  subject.  It  is  claimed  that  we  have  to  deal  not  with 
a  world  wherein  the  standard  of  life  is  uniform,  and  all  busi- 
ness ordered  with  an  eye  to  the  equal  comfort  of  all,  but  with 
one  in  which  each  individual  and  each  nation  is  struggling 
for  advantage  over  all  others.  Finding  ourselves  in  this 
hurly-burly,  we  must  protect  ourselves  or  be  trampled.  Our 
resources  are  so  vast  and  varied  that  we  can  produce  every- 
thing essential  to  our  welfare,  except  the  products  of  the 
tropics,  somewhere  within  our  bounds,  as  cheaply  as  the  same 
goods  can  be  produced  elsewhere  by  those  whose  standard  of 
life  is  equal  to  our  own.  We  know  that  whatever  we  may  do, 
our  products  can  not  usuall}^  pass  from  our  borders  without 
meeting  tariff  walls  erected  by  others.  We  must  so  arrange 
our  own  tariffs  that  we  do  not  suffer  in  the  contest.  The 
tendency  of  civilization  is  doubtless  towards  an  equalizing  of 
condition  for  those  following  the  same  occupation  throughout 
the  world.  This  is  favorable  to  those  having  low  standards  of 
life,  but  unfavorable  to  those  of  high  standards.  Our  standard 
of  life  is  a  high  one,  and  it  is  our  interest  to  prevent  the  leveling 
of  standards  as  long  as  we  can.  It  is  true  that  to  some  extent 
our  high  standard  is  maintained  by  the  exploitation  of  natural 
resources  which  it  would  be  graceful  to  leave  for  the  enjoyment 
of  future  generations.  As  a  matter  of  fact,  however,  no  human 
being  has  ever  refrained  from  the  use  of  opportunity  available 
20 


306  THE    QUESTIONS    OF    THE    DAY. 

to  himself  for  the  purpose  of  benefiting  posterity,  and  none 
ever  will.  No  elements  of  fertility  are  lost  except  those  which 
flow  into  the  sea,  and  even  of  those  some  portion  is  returned.* 
Each  generation  finds  itself  able  to  meet  the  conditions  of  its 
time,  and  we  must  assume  that  this  condition  will  always 
continue.  The  best  markets  are  always  home  markets,  and 
the  promotion  of  diversified  industries  does  make  openings  at 
home  for  the  differing  tastes  and  talents  of  our  youth,  and  by 
keeping  them  here  increases  the  market  for  home-made  com- 
modities. Economic  science  assumes  a  condition  of  commercial 
peace,  while,  as  a  matter  of  fact,  the  world  is  the  theater  of 
unceasing  commercial  war.  In  this  war  the  best  defense  of  a 
nation  so  richly  and  variously  endowed  as  our  own,  is  claimed 
to  be  such  a  protective  tarifl'as  shall  result  in  full  occupation 
for  all  our  people  in  producing  commodities  and  exchanging 
them  among  ourselves.f 

The  arguments  for  and  against  the  protective  principle  as 
a  fiscal  measure  for  world-wide  application,  as  condensed  on  a 
previous  page,  are  of  course  the  most  important,  as  they  go  to 
the  root  of  the  whole  matter.  They  are  not  likely,  however, 
to  become  prominent  in  popular  discussion,  which  has  usually 
been  and  will  probably  continue  to  be  mainly  directed  to  the 


*  The  coal  burned  seems  to  be  largely  lost  to  future  economic  use. 

t  It  is  proper  to  note  that  the  advantages  of  a  protective  tariff  havr  probably 
been  more  obvious  during  our  national  career  to  this  time  than  they  can  be 
hereafter.  During  our  period  of  most  rapid  growth,  a  continuous  stream  of 
immigrants,  in  connection  with  a  high  birth-rate,  afforded  a  prompt  market  for 
all  the  manufactures  which  could  be  produced  with  our  limited  capital.  The 
abundance  of  food  and  of  opportunities  for  labor  restrained  the  growth  of  unein 
pi  )y' d  and  dependent  classes.  With  the  abundant  capital  now  accumuhitcil . 
we  can  easily  produce  a  surplus  of  manufactures,  with  a  constant  increase  in  lli" 
capital  and  labor  which  can  be  profitably  employed  only  in  producing  foi- 
foreign  markets.  These  conditions  must  result  in  such  reductions  of  cost,  in 
part,  unfortunately,  involving  a  lowering  of  our  standard  of  life,  as  will  roiulor 
our  manufacturers  more  independent  of  foreign  competition  in  home  markets. 
This  will  not,  however,  reduce  the  demand  for  protection,  whicli  our  manufac- 
turers will  continue  to  seek  in  order  to  be  able,  by  obtaining  good  prices  at 
home,  to  show  an  average  profit,  while  disposing  of  surplus  stocks  at  lower  rates, 
if  necessary,  in  foreign  markets. 


THE   FARMER   AND   THE   TARIFF. 


307 


circumstances  of  the  particular  nation  in  which  action  is  pro- 
posed or  resisted.  As  shown  below,  tlie  necessity  of  preparing 
for  war  by  making  ourselves  industrially  independent  is  a 
common  argument,  but  war,  in  its  usual  sense,  i^  infrequent  in 
modern  times,  and  at  any  rate  its  losses,  both  of  life  and  prop- 
erty, are  insignificant  as  compared  with  the  casualties  of  com- 
mercial war  in  which  we  are  constantly  engaged.  More  people 
have  starved  as  the  result  of  commercial  war  than  were  ever 
killed  in  battle.  A  common  argument  for  protection  is  its 
effectiveness  as  a  weapon  in  commercial  wars. 

Political  writers,  however,  do  not  concede  that,  even  from 
any  economic  standpoint/,  the  free  trade  arguments  can  not 
be  met.  The  economic  arguments  against  protection,  and 
those  for  it,  as  commonly  employed,  are  as  follows: — 

In  behalf  of  protection  it  is  urged  that — 

1.  Protection  establishes  and  maintains  a  great  number 
of  industries  which  otherwise,  either  from  our  inferiority  in 
natural  advantages,  or  lower  standard  of  life  in  competing 
countries,  could  not  exist  here. 

2.  That  these  industries  are  both  manufacturing  and  agri- 
cultural. 

3.  That  these  industries  furnish  profitable  employment  for 
a  great  number  of  people  who  would  otherwise  necessarily  be 
engaged  in  the  production  of  commodities  for  which  this 
country  may  be  best  adapted  under  existing  circumstances, 
but  in  which,  so  far  as  they  are  exported,  we  must  compete  in 
the  world's  market  with  those  of  an  inferior  standard  of  life. 

4.  That  whenever  a  reasonable  protection  will  maintain 
such  industries,  those  engaged  in  them  are  more  profitably 
employed  than  if  engaged  in  producing  for  a  more  strongly 
contested  market. 

5.  That  the  employment  of  large  numbers  in  protected 
industries  supplies  a  home  market  for  great  quantities  of 
products  of  other  industries  whether  directly  protected  or  not. 

6.  That  this  diversity  of  industries  renders  the  nation 
better  able  to  endure  the  stress  of  warfare,  whether  commercial 
or  military. 

7.  That  a  home  market  saves  expense  not  only  in  trans- 


308  THE    QUESTIONS    OF    THE    DAY. 

portation,  but  in  profits,  the  profit  of  middlemen  necessarily 
increasing  as  tlie  market  is  more  distant. 

8.  That  wages  are  made  liigher,  and  that  even  if  no  greater, 
in  purchasing  power,  per  unit  of  time  employed,  by  reason  of 
the  general  increase  of  prices,  their  aggregate  purchasing  power 
is  greater  by  reason  of  more  constant  employment. 

9.  That,  as  a  matter  of  fact,  our  natural  exports  being  so 
largely  agricultural,  and  likely  for  some  time  to  remain  so  in 
the  absence  of  protective  legislation,  we  are  making  undesir- 
able drafts  on  our  natural  resources,  and  that  it  is  better  that 
some  larger  portion  of  our  population  be  employed  in  other 
industries. 

10.  That  since  a  tariff  for  revenue  is  a  fixed  part  of  our 
fiscal  policy,  such  industries  as  are  taxed  at  all  are  protected 
to  that  extent,  and  it  is  therefore  only  just  that  all  industries 
have  equal  protection,  and  as  we  know  that  as  a  matter  of  fact 
all  industries  will  seek  and  many  obtain  a  greater  protection 
than  the  necessities  of  the  treasury  would  require,  the  surest 
way  to  assure  justice  to  all  is  to  protect  all  to  such  a  reasonable 
point  as  will  not  entirely  cut  off  revenue  by  preventing  impor- 
tation, while  giving  the  public  the  benefit  of  free  trade  on  such 
commodities  as  we  can  never  produce. 

11.  That  import  trade  in  such  commodities  as  we  can  pro- 
duce is  wholly  unnecessary  in  such  a  country  as  the  United 
States,  whose  vast  extent  gives  ample  scope  for  domestic 
exchanges  which  move  freely,  and  that  as  a  matter  of  fact  the 
more  our  foreign  trade  increases  in  the  face  of  the  stress  of 
competition,  the  greater  our  necessity  for  vast  naval  expenses 
to  protect  that  trade  under  the  danger  of  the  international 
clashes  of  interest  which  are  always  arising;  the  more  we 
expand  our  export  trade  the  greater  difficulty  we  shall  have 
in  maintaining  our  traditional  policy  of  freedom  from  foreign 
entanglements.  To  the  extent,  therefore,  that  a  protective 
tariff  diversifies  our  industries,  and  directs  our  efforts  to 
domestic  exchanges,  it  is  a  wise  political  policy.* 


*I  do  not  cumber  the  text  with  the  argument  for  protecting  an  "infant 
industry,"  until  fairly  established,  with  the  intent  of  removing  the  protection 


THE  FARMER  AND  THE  TARIFF.  oO\) 

The  opponents  of  protection  insist: — 

1.  That  every  industry  established  by  protection  displaces 
some  other  that  could  exist  without  protection,  and  which  it 
would  therefore  be  most  profitable  for  us  to  pursue. 

2.  That  therefore  no  more  people  are  employed  under 
protection  than  would    find  employment    without  it. 

3.  That,  in  despite  of  the  low  prices  which  must  be  expected, 
there  is  always  more  net  profit  in  producing  those  commodities 
for  whose  production  our  natural  advantages  are  greatest,  and 
purchasing  those  which  others  can  produce  cheaper  than  we, 

4.  That,  while  it  is  true  that  protection  makes  a  home 
market  for  commodities  which  we  should  otherwise  export,  the 
extra  profit  in  their  sale  is  more  than  absorbed  by  the  higher 
prices  which  we  pay  for  the  protected  articles. 

5.  That  the  argument  of  the  necessity  of  maintaining 
diversified  industries  as  a  resource  in  time  of  war,  is  of  little 
or  no  force  as  applied  to  the  United  States,  as  under  any 
circumstances  we  should  be  able  to  supply  ourselves  with 
whatever  is  essential. 

6.  That  the  saving  in  transportation  and  profits  in  the  case 
of  industries  requiring  protection  is  less  than  the  extra  prices 
paid  for  the  protected  commodities,  because  if  it  were  not  so 
they  would  be  produced  without  protection. 

7.  That,  while  wages  will  be  nominally  higher  under  i)ro- 
tection,  their  purchasing  power  is  less  than  tiiat  of  the  wages 
wiiicli  would  prevail  under  free  trade. 

8.  That  a  protective  tariff  involves  continued  intrigue  in 
legislation,  with  the  result  that  the  strongest  industries  always 
receive  undue  protection. 

9.  That  protection  leads  to  oppressive  monopolies,  because 
the  strong  industries,  protected  by  law  from  foreign  compe- 
tition, will  combine  in  trusts  to  extinguish  competition  among 
themselves,  and  that  this  combination  will  be  against  labor 


after  it  is  well  on  its  feet.  The  urgument  given  is  for  tlie  permiinont  niuintc- 
nance  of  the  protective  principle.  Most  modern  economists  admit  that  it  may 
frequently  be  wise  to  give  a  new  industry  a  start  by  protection,  while  calling 
attention  to  the  fact  that  no  such  industry  ever  lets  go  of  protection,  no  matter 
how  prosperous. 


310  THE   QUESTIONS   OF   THE   DAY. 

as  well  as  against  the  public  and  so  tend  to  keep  down  wages 
while  increasing  profits  to  employers. 

10.  That,  as  a  matter  of  fact,  industries  which  can  live  only 
by  protection  are  always  in  a  precarious  position,  on  account 
of  the  fluctuations  in  popular  sentiment.  At  any  time  the 
protection  may  be  abandoned,  and  the  industry  consequently 
crippled,  people  thrown  out  of  employment,  expensive  plants 
rendered  useless,  and  losses  incurred  which  will  far  more  than 
absorb  whatever  profit  has  been  made  during  the  period  of 
fictitious  prosperity. 

11.  That  the  largest  amount  of  products  will  be  secured  at 
the  least  expense  if  all  portions  of  the  earth  are  devoted  to 
whatever  they  are  most  fit  for,  and  that  this  will  always  be 
the  case,  in  the  long  run,  when  there  are  no  artificial  barriers 
erected. 

From  the  above  resum^  of  the  arguments  on  the  two  sides 
of  the  question,  the  reader  may  determine  which  side  he  will 
espouse. 

I  have  not  introduced  into  the  argument  on  either  side  of 
the  tariff  controversy  the  question  of  the  "balance  of  trade" 
— that  is,  the  question  whether  we  do  or  should  try  to  sell 
more,  in  the  aggregate,  to  foreign  nations  than  in  the  aggre- 
gate we  buy  of  them,  for  the  reason  that  I  do  not  think  it 
belongs  there.  Protectionists,  however,  sometimes  insist  that 
a  protective  policy  always  assures  to  any  nation  the  power 
of  obtaining  for  itself  a  favorable  balance  of  trade,  while  free- 
traders claim  that  if  this  power,  if  it  exists,  which  they  deny, 
were  regularly  employed,  it  would  be  often  at  a  cost  which 
no  nation  could  endure.  As  I  doubt  whether  either  can 
prove  the  other  wrong  it  will  be  most  profitable  not  to  go 
very  far  into  the  subject.  It  may,  however,  be  well  to  con- 
sider it  briefly. 

The  discussion  in  regard  to  the  balance  of  trade  in  inter- 
national transactions  began  more  than  a  century  and  a  half 
since,  but  most  early  discussion  is  so  complicated  with  refer- 
ence to  ancient  ideas  in  regard  to  a  supposed  necessity  of 
regulating  the  international  movements  of  the  precious 
metals,  as  to  be  almost  worthless  as  an  aid  to  a  consideration 


THE    FARMER    AND    THE    TARIFF.  311 

of  the  subject  from  a  modern  standpoint.  In  its  modern 
form  the  "  balance-of-trade"  theory  may  be  stated  as  follows: 
It  is  evident  that,  except  by  incurring  debt,  or  drawing  upon 
capital,  no  individual,  in  any  one  year,  can  purchase  com- 
modities except  such  as  he  can  pay  for  by  the  proceeds  of  his 
own  produce  or  labor,  plus  his  income,  if  any,  from  interest, 
rent,  or  other  income  from  accumulated  capital.  If  he  spends 
less  than  he  receives,  he  accumulates  wealth;  if  otherwise,  he 
falls  behind.  The  balance-of-trade  theory  assumes  that  in 
this  respect  a  nation  is  precisely  like  an  individual.  As  the 
movements  of  money,  however,  can  not  be  traced,  we  can 
regard  only  the  movements  of  merchandise,  of  which  records 
are  kept  in  the  custom-houses  of  all  nations.  If  the  value  of 
imports  exceeds  those  of  the  exports,  there  is  an  "unfavorable" 
balance  of  trade,  and  the  nation  is  said  to  be  losing  money,  pay- 
ing for  the  surplus  of  imports  by  money  received  from  ocean 
freights,  or  from  the  income  or  principal  of  previous  foreign 
investments,  or  by  incurring  debt.  This  seems  sufficiently 
obvious,  and  is,  in  fact,  the  universal  popular  belief  in  all 
countries.  Not  only  the  public,  but  statesmen  and  financiers 
look  with  great  satisfaction  upon  annual  treasury  statements 
showing  that  the  country  has  sold  more  than  it  has  bought. 
This  doctrine,  however,  is  not  only  vigorously  disputed  by 
most  economists,  but  is  treated  with  contempt  as  an  "exploded 
theory."  I  can  not  go  into  the  detail  of  their  argument,  which 
it  requires  a  rather  highly-trained  mind  to  appreciate,  but  in 
substance  it  is  this:  As  a  matter  of  fact  the  total  exports  of  a 
country  do  substantially  pay  for  its  imports;  but  each  pur- 
chase fftr  importation  is  presumed  to  involve  a  future  profit, 
while  from  goods  sold  for  export  nothing  beyond  the  purchase 
price  is  to  be  expected ;  therefore  the  more  imports  the  more 
profit,  and  a  healthy  balance  of  trade  is  one  which  shows  a 
large  excess  of  imports  which  have  been  paid  for  by  exports  of 
less  value.*      As  this  is  not  a  treatise  on  abstract  economic 


*  McLeod  illustrates  by  the  example  of  a  sailor  who  might  buy  an  axe  in 
London  for  65  cents  and  trade  it  to  a  South  Sea  islander  for  a  pair  of  shells, 
which  he  might  bring  to  London  and    sell  for  $50.       In  this  case  the  value 


312  THE   QUESTIONS   OF   THE    DAY. 

doctrine  I  shall  not  attempt  to  settle  the  question,  but  will 
refer  the  reader  to  works  on  economic  theory.  The  modern 
theory  of  trade  supposes  that  ordinary  mercantile  transactions 
involve  a  profit  to  both  parties  thereto,  and  the  more  trade  on 
either  side  the  more  profit  on  both  sides,  but,  like  the  majority 
of  my  countrymen,  I  confess  to  a  more  comfortable  fe.eling 
when  I  think  we  are  taking  in  for  commodities  more  money 
than  we  are  paying  out  for  them.  As  to  this,  however,  I  do  not 
think  we  can  tell  very  much  from  treasury  statistics,  for  the 
reason  that,  except  when  valuing  for  the  purpose  of  assessing 
ad  valorem  duties,  the  valuations  are  not  reliable.  In  the 
commission  trade,  which  is  enormous,  the  valuations  on 
invoices  are  wholly  pro  forma.  Roughly  the  figures  give  us 
some  idea  of  what  we  are  doing,  but  they  are  not,  in  any  trade 
with  which  I  am  familiar,  reliable  for  calculating  balances. 
There  is  also  the  question  of  ocean  freights  to  be  considered, 
which  form  part  of  the  cost  of  the  delivered  merchandise;  and 
it  has  always  to  be  considered  whether  a  country,  like  Eng- 
land, produces  no  precious  metals,  or  whether,  like  the  United 
States,  it  produces  enormously  more  than  it  can  use  at  home. 
I  have  thus  briefly  touched  the  subject,  partly  because  it  is  a 
matter  that  largely  enters  into  popular  discussions  of  the 
tariff  question,  and  partly  to  give  my  plain  readers  an  idea  of 
the  subtlety  of  some  doctrines  over  which  controversial  econo- 
mists dispute.  I  think  most  of  us  will  be  happier  if  we  reach 
conclusions  without  trying  to  solve  such  problems  as  this. 
Their  solution  is  not  essential  to  the  ap])lication  of  ordinary 
common  sense  to  ordinary  transactions. 


of  the  imports  would  enormously  exceed  the  value  of  the  exports,  luid  yet  no 
one  could  dispute  the  profit  of  the  transaction  to  the  thrifty  sailor,  which 
McLeod  assumes  to  be  the  same  for  the  nation.  It  will  be  a  good  mental  exer- 
cise to  think  out  whether  or  not  this  assumption  is  correct. 


CHAPTER  II. 

THE  FARMER  AXD  AN  EXPORT  BOUNTY. 

AMONG  the  minor  questions  upon  which  effort  is  being 
expended  to  secure  political  action  is  a  proposition  that 
the  United  States  shall  pay  an  export  bounty  on 
"staple"  agricultural  products,  the  word  "staple"  probably' 
being  intended  to  include  cotton,  grains,  tobacco,  and  any 
other  important  agricultural  products  which  we  might  export 
largely,  and  whose  home  price  is  entirely  controlled  by  the 
prevailing  prices  in  the  markets  of  the  w^orld  outside  the 
United  States.  I  speak  of  tliis  as  a  "  minor"  question  in  the 
sense  that  it  has  never  yet  obtained  sufficient  following  to  be 
able  to  secure  the  endorsement  of  any  great  political  party. 
It  has,  however,  been  energetically  pushed  among  the  farmers, 
and  has  been  indorsed  by  one  or  two  State  Granges.  It  has 
never,  however,  obtained  tlie  support  of  the  National  Grange, 
or  any  other  important  national  body. 

A  bounty  on  exports  is  a  tax  paid  by  the  entire  nation  for 
the  benefit  of  tlie  producers  of  the  article  on  which  the  bounty 
is  paid.  The  supposition  is  that,  although  the  bounty  will  be 
paid  to  the  exporter,  who  is  not  likely  to  be  the  producer,  the 
latter  will  be  able  to  obtain  for  his  product  a  price  increased 
by  the  amount  of  tlie  bounty. 

In  the  case  of  the  United  States  it  is  claimed  that  such  a 
bounty  is  just  and  necessar^^  for  the  reason  that  our  stai)le 
agricultural  exports,  like  wheat  and  cotton,  are  produced 
enormously  in  excess  of  our  home  consumption,  and,  although 
nominally  })rotected  by  the  tariff,  are  in  reality  not  protected 
in  the  least,  for  tlie  reason  that,  as  we  always  have  a  great 
overplus,  there  is  and  could  be  no  imports  from  any  source, 
of  any  consequence.  The  price  of  the  produce  exported  is 
determined  by  the  competition  of  the  entire  world  at  the 
centers  of  consumption,  and  will  always  be,  as  compared  with 

(313) 


814  THE    QUESTIONS    OF    THE    DAY. 

the  average  of  prices  in  a  protected  country,  a  low  price;  but 
the  home  price  of  commodities  largely  exported  will  always 
be  determined  by  their  value  for  export,  which  they  can  never 
exceed.  This  is  not  only  theoretically  true,  but  as  a  matter  of 
fact  every  farmer  knows  that  the  price  of  wheat  in  America 
is  always  governed  by  the  price  at  Liverpool,  which  is  daily 
cabled  to  this  country,  and  which  our  home  prices,  within 
certain  very  narrow  limits,  implicitly  follow.  The  same  is  true 
of  all  other  commodities  which  we  produce  largely  in  excess 
of  home  requirements.  The  result  is,  as  is  claimed,  that  the 
producer  of  these  commodities  in  the  United  States  is  greatly 
at  a  disadvantage  as  compared  with  his  fellow-citizens,  since 
he  is  compelled  to  purchase  supplies  at  protected  prices,  with 
the  proceeds  of  commodities  sold  in  competitive  markets. 
In  order,  therefore,  that  the  producer  of  ex[)orted  staples 
should  have  equal  protection  with  the  producers  of  other 
commodities,  it  is  claimed  that  it  is  necessary  to  compensate 
him  by  a  bounty  on  all  staples  exported.  As  it  is  claimed  that 
this  would  raise  the  price  for  export  by  the  amount  of  the 
bounty,  it  would  raise  the  price  of  all  consumed  at  home  by  the 
same  amount,  since  no  one  would  sell  for  home  consumption 
at  a  lower  price  than  he  would  receive  for  export.  The  pro- 
tected classes  would  then  pay  to  the  farmers  such  an  increased 
price  for  the  commodities  in  question  as  would  afford  to  them 
the  same  protection  that  they  themselves  enjoy.  This  is 
claimed  to  be  evidently  just. 

To  this  argument  one  part}^  replied  that  the  injustice  dis- 
closed is  self-evident,  but  that  the  remedy  proposed  is  inade- 
quate and  futile.  The  proper  course,  as  they  claim,  for  the 
})roducers  tlius  injured  to  pursue,  is  iiot  to  attempt  to  juggle 
by  balancing  one  injustice  again.st  another,  but  to  abandon  the 
whole  scheme  of  protection,  thus  putting  all  upon  an  equality 
at  once.  This  opens  up  the  whole  question  of  free  trade  and 
protection,  which  was  discussed  in  the  last  chapter. 

The  protectionists  meet  the  argument  in  another  way. 
They  agree  with  the  free  traders  that  the  remedy  is  inadequate 
and  futile,  but  deny  the  injustice,  claiming  that  the  producer 
of  staple  oxi)orto(l    products   shares   equally  with  others    the 


THE  FARMER  AND  AN  EXTORT  COUNTY.         315 

increased  prosperity  whicli  they  claim  to  be  given  by  protec- 
tion, by  the  increased  home  market  for  general  agricultural 
products,  which  they  may,  if  they  choose,  produce.  They  say 
that  if  the  farmer  deliberately  continues  to  produce  commodities 
which  he  knows  must  be  sold  at  competitive  prices,  instead  of 
other  commodities  for  which  protection  provides  a  home 
market,  he  must  not  blame  protection  for  the  consequences  of 
his  fully,  and  that  as  u  matter  of  fact  he  will  not  do  so,  but 
that  gradually,  under  a  permanent  system  of  rational  protec- 
tion, the  agricultural  industries  would  be  directed  to  the  pro- 
duction of  such  commodities,  including  staples,  as  the  increas- 
ing manufacturing  and  trading  population  would  require,  and 
that  they  would  thus  come  to  participate  in  the  benefits  of 
protection  as  rapidly  as  other  classes.  Some  of  them  say  that, 
while  the  attempt  to  conquer  foreign  markets  by  means  of 
bounties  forms  no  part  of  the  policy  of  protection,  which  is 
confined  to  the  assuring  of  tlie  home  market,  yet  they  would 
not  seriously  object  to  engrafting  on  the  bounty  system,  were 
there  any  possibility  of  accomplishing  its  object,  but  as  there 
is  not,  they  decline  to  support  it. 

It  is  plain  that  the  argument  of  this  class,  like  that  of  the 
free  traders,  reopens  the  subject  of  protection  and  free  trade, 
already  considered. 

The  principle  of  giving  aid  to  an  industry  by  means  of 
a  bounty  on  exports  of  its  products  finds  no  support  from 
any  quarter  entitled  to  respect  for  anything  but  its  honesty. 
American  economists,  if  they  allude  to  the  subject  at  all,  do  so 
only  in  the  most  cursory  manner,  nor  has  the  discussion  in 
this  country  ever  yet  assumed  proportions  sufficient  to  draw 
the  attention  of  those  most  competent  to  engage  in  it.*  In 
some  countries  of  Europe  it  is  a  question  of  national  and 
international  importance,  but  the  question  di.scussed  is  not 
that  of  imposing  the  bounty  but  of  how  to  get  rid  of  it.     In 


*  I  should  nuike  one  exception  to  this  remark.  Mr.  David  Lul)in,  of  Ciili- 
fornia,  the  apostle  of  the  export  bounty  in  America,  is  a  man  of  very  keen 
intellect.  There  is  some  internal  evidence,  however,  that  he  entered  upon  this 
propaganda  without  adequate  previous  study  of  the  working  of  the  export 
bounty  .system  in  other  countries. 


310  THE    QUESTIONS    OF    THE    DAY. 

• 

Great  Britain,  it  is  true,  there  is  some  respectable  support  of  a 
proposal  to  pay  bounties  on  staple  agricultural  exports,  but  the 
object  sought  to  be  attained  there  is  not  economic  but  military. 
Great  Britain  being  an  island,  not  producing  sufficient  food 
for  its  population,  the  fear  is  expressed  that  in  case  of  war 
involving  danger  to  the  control  of  the  sea,  its  inhabitants 
might  be  reduced  to  great  distress  for  lack  of  the  staples  of 
life,  and  it  is  therefore  held  by  some  that  it  would  be  econom- 
ical for  the  country,  by  bounties,  to  stimulate  the  production 
of  those  substantial  food  products  which  are  absolutely  essen- 
tial, even  at  the  expense  of  increasing  its  importations  of  such 
products  as  vegetables  and  fruits,  which  in  case  of  emergency 
could  better  be  spared.     This  is  antagonized  by  others  who 
claim    that   it   would    be   cheaper  for   the    nation   to   build 
immense  storehouses,  and  keep  on  hand  supplies  of  grain  pur- 
chased at  competitive  prices,  sufficient  to  last  through  one  of 
our  modern  short  wars.     If  the  bounty  plan  were  adopted  for 
Great  Britain,  it  would  seem  to  be  necessarily  a  bounty  on 
production  rather  than  upon  exports,  as  the  country  does  not 
wish  to  encourage  exports,  and  indeed  would  not  be  likely  to 
export.    In  tlie  seventeenth  and  eighteenth  centuries,  when  the 
population  of  England  was  less,*  export  bounties  were  paid 
on   grain,   and    did   have   the   effect   of    greatly   stimulating 
production.     In  Great  Britain,  however,  the  proposition,  so  far 
as   considered   at   all,  is   considered   solely  as   a   measure   of 
national  defense. 

A  sufficient  objection  to  the  export  bounty  as  proposed  in 


*From  1689  to  1815— a  period  of  126  years— England  paid  an  export 
bounty  of  5  shillings  a  quarter  (8  bushels)  at  all  times  when  tlu;  home  price 
of  wheat  did  not  rise  above  a  certain  amount,  which  at  first  was  48  shillings 
a  quarter,  and  after  1773,  44  shillings.  In  1815  the  bounty  on  exports  was 
repealed,  and  imports  of  wheat  prohibited  whenever  the  home  price  did  not 
exceed  80  shillings  a  quarter,  reduced  in  1822  to  70  shillings.  In  1829  the 
prohibition  was  removed,  and  an  import  duty  of  23s.  8d.  levied  when  wheat  was 
below  64  .shillings  a  quarter,  with  a  smaller  duty  as  prices  should  rise,  the 
system  being  abolished  in  1846.  I  have  not  verified  these  figures,  considering 
the  Mark  Lane  Express,  in  which  I  find  them,  a  sufficient  authority.  This 
artificial  regulation  of  the  prices  of  bread  at  times  caused  great  distress.  JFor 
the  most  of  this  time  England  was  able  to  produce  all  her  own  food. 


THE    FAKMKK    AND    AX    KXl'OUT    BOUNTY.  317 

the  United  States,  is  that  it  will  not  accomplish  what  its 
advocates  expect.  The  reason  of  this  is  that  the  bounty  so 
stimuhites  production  that  the  commodity  soon  falls  in  value 
by  the  full  amount  of  the  bounty  paid.  This  does  not  ha|)pen 
at  once.  On  the  contrary,  tlio  first  effect  is  to  raise  the  price  of 
the  commodity  precisely  as  anticipated  by  its  advocates.  The 
foreign  price  is  not  changeil,  as  of  course  it  could  not  be  by 
such  means,  but  the  domestic  price  is  raised.  If  wheat, 
without  bounty,  is  worth  $1.00  per  bushel  for  export,  and 
a  bounty  of  10  cents  per  bushel  is  paid  on  exported  wheat,  the 
exporter  will  receive  $1.10,  and  will  therefore  pay  to  the 
farmer  10  cents,  or  nearly  that,  more  than  be  would  otherwise 
pay  him.  So  long  as  there  is  an  export  demand  the  farmer 
will  refuse  to  sell  at  a  less  price  for  domestic  use.  The 
domestic  consumer  will  therefore  pay  an  extra  10  cents  a 
bushel  for  all  wheat  consumed  at  home,  and  the  government 
will  pay  the  farmer  the  same  amount  on  all  sold  for  consump- 
tion by  foreigners. 

This,  however,  in  a  country  like  ours,  where  wheat  produc- 
tion can  be  largely  increased,  will  at  once  stimulate  i)roduction, 
and  within  a  year  or  two  the  foreign  price  will  tend  to  fall  by 
reason  of  the  increased  supply.  Oats  and  corn  and  linseed — 
for  all  products  largely  exported  would  certainly  claim  the 
bounty — would  be  still  more  easily  affected.  It  is  still  possible, 
however,  that  for  some  years  at  least  there  would  still  remain 
an  appreciable  advantage  to  the  farmer  if  competing  export- 
ing nations  would  pay  no  attention  to  what  is  going  on.  They 
would  not  and  indeed  could  not  do  this,  however,  for  this  is 
what  would  happen:  The  grain  being  made  by  tiie  bounty 
worth  more  for  export  than  for  feeding,*  the  tendency  would 
be  to  increase  our  exports  of  feeding  grains:  and  so  of  all 
other  aided  connnodities.  The  tendency  would  be  to  push  the 
profitable  export  market  to  the  utmost,  and  in  the  effort  to  get 
all  the  trade  possible,  such  reduction  as  might  be  required  to 
gain  a  larger  share  of  the  trade  would    certainh'  be   made; 


*  Because   before  the   bounty  all   that  could  be   profitably  fed  to   animals 
would  be  used  in  that  way. 


318  THE    QUESTIONS    OF    THE    DAY. 

this  would  immediately  begin  to  take  trade  away  from  com- 
peting exporting  countries,  which,  in  order  to  protect  them- 
selves, would  surely  begin  to  pay  export  bounties  on  the  same 
commodities.  We  know  that  this  would  happen  because  it 
always  has  happened.  Nations,  no  more  than  individuals, 
will  permit  trade  to  slip  out  of  their  hands  without  a  fight  to 
retain  it.  This  would  enable  competing  nations,  to  meet  our 
cut  prices  and  perhaps  go  a  little  lower  in  the  effort  to  quickly 
recover  lost  trade,  the  result  being  a  competition  between  all 
exporting  nations  as  to  which  should  sell  cheapest  to  the 
importing  nations.  This  would  please  the  consuming  classes 
of  those  nations  very  much,  but  would  excite  great  antagonism 
among  the  farmers  of  the  same  nations,  who  would  see  their 
home  markets  cut  off  by  what  they  would  consider  unfair 
competition,  since  it  would  not  be  competition  between  them- 
selves and  other  farmers,  but  between  them  and  otlier  farmers 
aided  by  the  taxation  of  other  classes.  The  consequence 
would  be  that  foreign  governments,  even  of  nations  w^hich 
profited  most  by  the  low  prices,  would  be  inclined  to  take 
retaliatory  measures  on  account  of  the  injury  done  to  a  portion 
of  their  own  people.  It  is  not  necessary  to  further  speculate 
as  to  what  would  happen,  because  this  is  not  really  a  "question 
of  the  day  "  in  this  country,  and  never  can  become  so.  The 
bounty  which  has  been  roughly  proposed  by  the  advocates  of 
this  measure,  as  a  fair  offset  to  existing  tariffs,  is  ten  cents  a 
bushel  on  wheat,  five  cents  on  other  grains,  and  one  cent  a 
pound  on  cotton;  to  these,  before  a  bounty  law  could  be 
enacted,  it  would  be  necessary  to  add  bounties  upon  every 
other  article  which  we  export  or  have  any  probability  of 
exporting,  certainly  including  ships.  The  bounty  on  even 
the  articles  above  enumerated,  for  the  quantities  exported  in 
1897,  would  amount  to  more  than  $51,000,000,  and  with  the 
other  articles  which  could  certainly  find  a  place  in  the  law — 
for  it  could  not  pass  except  by  including  every  industry  which 
could  possibly  gain  by  it — and  the  ra])id  increase  of  exports 
to  be  expected  under  such  a  stimulus,  an  expenditure  for  this 
purpose  of  not  lees  than  $100,000,000  a  year  from  the  treasury 
would  have  to  be  expected  in  the  immediate  future.    It  should 


THE    FARMER    AND    AN    EXPORT    BOUNTY. 


319 


be  unnecessary  to  say  that  it  would  be  impossible  to  obtain 
from  any  Congress  appropriations  for  bounties  on  such  a 
gigantic  scale;  the  country,  rather  than  do  that,  would 
unquestionably  abandon  the  entire  policy  of  protection  and 
adopt  free  trade.  Indeed,  it  is  alleged  by  protectionists  that 
such  discussion  as  there  has  been  in  this  country  upon  this 
subject,  is  the  result  of  sly  fostering  by  free  traders,  who  hope 
in  this  way  to  ultimately  get  recruits  for  their  ranks.  At  any 
rate,  tlie  experience  of  this  country  shows  it  to  be  opposed  in 
sentiment  to  paying  bounties.  In  1890  the  duty  on  sugar  was 
reduced  to  a  ])oint  which  it  was  expected  would  destroy  the 
sugar  planting  interest  in  Louisiana,  and  as  compensation  a 
bounty  on  production  was  given  of  two  cents  a  pound.  This 
was  repealed,  with  general  approval,  in  1894.  There  is  no 
reason  to  expect  that  in  a  nation  of  such  varied  and  differing 
interests  as  our  own,  an  export  bounty,  even  if  enacted,  would 
remain  on  the  statute-book  for  any  considerable  time.  In 
the  meantime,  if  it  should  be  permitted  to  remain,  its  effects 
would  be  as  above  stated.  Stimulated  production  in  this 
country,  followed,  as  it  certainly  would  be,  by  similar  stimu- 
lation in  other  exporting  countries,  would  soon  glut  the 
importing  countries  with  products  which  could  only  be  dis- 
posed of,  if  at  all,  by  reducing  the  price  until  all  vestige  of 
benefit  to  the  farmers  in  any  country  had  disappeared.  The 
inevitable  repeal  woirid  assuredly  follow  at  that  time,  and  the 
farmers  whom  it  was  intended  to  benefit  would  be  worse  off 
than  ever.  The  prosperity  of  tlie  first  year  or  two  would 
certainly  induce  debt  for  machinery,  land,  and  an  increased 
scale  of  living  on  the  part  of  farmers  unfamiliar  with  the 
laws  of  trade,  only  to  be  followed,  upon  the  explosion  of  the 
bubble,  by  the  serious  and  widespread  distress  which  is  the 
necessary  consequence  of  such  errors  on  a  large  scale. 

I  have  stated  the  theoretical  position  wdiich  is  held,  without 
exception,  by  all  economists  and  well-informed  statesmen,  with 
perhaps  more  positiveness  than  I  should  have  employed  had 
there  not  been  at  hand  an  illustration  on  a  very  large  scale, 
absolutely  confirming,  in  every  particular,  the  position  of 
modern  "theorists."     Up  to  a  recent  time  the  production  of 


320  THE    QUESTIONS    OF    THE    DAY. 

sugar  was  mainly  confiiied  to  tropical  countries,  a  few  sub- 
tro[)ical  districts  like  our  own  gulf  states  producing  more  or 
less,  but  always  at  a  disadvantage,  except  as  aided  by  tariffs 
or  bounties.  The  discovery  that  sugar,  identical  with  that  of 
cane,  could  be  made  from  beets  was  made  many  years  ago,  but 
at  first  the  processes  were  too  expensive  and  unsatisfactory  for 
commercial  use.  Gradually  they  were  improved,  until,  about 
the  middle  of  the  nineteenth  century,  beet  sugar  began  to 
appear  in  the  markets  of  Europe.  Protected,  as  it  was  every- 
where, by  a  very  high  tariff,  the  manufacture  increased,  with 
improved  processes,  until  many  countries,  including  Germany, 
France,  Russia,  and  Austria,  were  producing  more  sugar  than 
their  populations  could  consume.  In  all  these  highly-taxed 
countries,  however,  sugar,  while  protected  by  a  high  tariff,  was 
subjected  to  an  internal  tax,  similar  to  that  which,  since 
the  Civil  War,  we  have  imposed  on  spirits  and  tobacco,  and 
collected  in  the  same  manner,  at  the  factories.  So  long  as 
their  product  was  all  consumed  at  home,  this  did  not  matter 
to  the  sugar  makers,  who  simply  added  the  tax  to  the  factory 
price,  and  the  people  paid  it.  The  sugar  supply  of  a  country, 
however,  important  as  the  article  is,  is  easily  made  to  exceed 
the  demand  in  any  country  where  labor  is  abundant,  because 
it  is  produced  from  a  comparatively  small  number  of  acres. 
The  main  cost  of  the  raw  material  of  sugar  is  labor.  In  all 
these  countries,  therefore,  the  supply  came  to  increase  to  a 
point  where  competition  between  factories  became  intense,  and 
the  weaker  were  in  danger  of  bankruptcy.  At  the  same 
time  they  found  it  impossible  to  export  sugar  upon  which 
the  internal  tax  had  been  paid,  because  importing  countries 
could  procure  it  cheaper  elsewhere.  In  this  emergency  the 
sugar  producers  appealed  to  the  government  to  remit  the 
internal  taxes  on  all  sugar  exported.  This  was  very  properly 
agreed  to,  as  it  only  placed  the  producers  of  those  countries  on 
an  equality  with  those  of  other  countries,  if  any,  whicn  were 
not  subjected  to  internal  or  export  tax,  and  gave  an  advan- 
tage, perhaps  legitimate,  over  producers  who  did  pay  such 
taxes.  The  government  still  received  a  tax  on  all  sugar  con- 
sumed at  home,  which  was  all  that  had  been  intended,  and 


THE    FARMER    AND    AN    EXPORT    BOUNTY.  321 

yet  left  their  people  free  to  compete  unhampered  in  the  world's 
market,  for  the  sale  of  their  surplus.  This  afforded  a  relief  for 
the  time,  but  with  the  increasing  outlet,  new  plantations  and 
new  factories  came  into  existence,  and  as  one  country  after 
another  adopted  the  rebate,  it  was  but  a  few  years  before  all 
were  as  badly  off  as  ever.  More  sugar  was  being  produced 
than  could  be  sold  anywhere  at  remunerative  prices.  In 
practice  the  internal  tax  had  continued  to  be  paid  at  the 
factories  as  before,  a  part  at  first,  and  then  the  whole  of  this 
tax  being  refunded  on  all  sugar  exported. 

At  til  at  time  it  is  probable  tliat  the  beet-sugar  factories 
were  at  a  disadvantage  in  competition  with  the  tropical  cane- 
sugar  producers,  tlie  process  of  extracting  and  refining  the  beet 
sugar  being  the  more  expensive.  At  any  rate,  as  the  renewed 
crisis  approached  in  the  beet-sugar  countries,  application  was 
made  for  actual  bounties  in  excess  of  the  internal  tax,  on  all 
sugar  exported,  and  this  finally  was  entered  upon,  one  after 
another,  by  all  the  beet-sugar  countries,  with  the  exception  of 
Russia,  which  stopped  with  the  refunding  of  the  internal  tax. 
This  gave  relief  to  the' countries  adopting  the  plan,  but  only 
for  a  brief  time,  for  production  quickly  caught  up  with  demand, 
and  competition  resulted  in  giving  away  the  entire  bounty  to 
foreign  buyers,  and  the  sugar  producers  of  Europe  are  just 
where  they  were,  in  point  of  price,  when  they  reached  the  limit 
of  home  consumption.  On  all  sugar  which  is  consumed  in 
the  country  where  made  there  is  a  possible  profit  to  producers, 
as  it  is  protected  by  a  high  tariff",  but  most  sugar  exported  is 
sold  positively  below  cost  of  production,  the  loss  being  made 
good  by  the  export  bounty  produced  by  general  taxation.  Of 
course,  also,  this  excess  of  supply  reacts  on  the  home  market, 
causing  sugar  to  sell  even  there,  for  the  most  part,  without 
profit.  In  the  meantime  the  other  classes  of  these  nations  are 
becoming  tired  of  paying  taxes  whose  only  result  is  to  supply 
foreigners  with  sugar  at  less  than  cost  of  production,*  and  are 


*  Great  Britain  is  the  largest  buyer  of  sugar,  and  has  for  years  got  all  her 
sugar  at  less  than  cost.  As  a  result,  sales  have  increased  there  until  the  per 
capita  consumption  of  sugar  is  greater  than  in  any  other  country  in  the  world. 

21 


322  THE    QUESTIONS    OF    THE    DAY. 

clamoring  for  a  repeal  of  the  bounty.  This,  however,  is  not 
an  easy  matter.  If  one  nation  discontinues  the  bounty,  it  at 
once  loses  all  its  foreign  trade,  which  will  be  seized  by  those 
nations  which  continue  to  pay  it.  If  one  or  all  discontinue  it, 
millions  of  capital  which  have  been  invested,  on  the  faith  of 
the  continuance  of  the  bounties,  in  factories,  wnll  be  lost,  and 
the  owners  will  be  bankrupt.  There  is  a  strong  pressure  to 
avoid  this  calamity,  and  yet  it  is  seen  that  the  present  situation 
can  not  continue. 

All  this  had  been  long  foreseen  by  the  different  govern- 
ments, which  at  the  same  time  could  see  no  escape  from  their 
dilemma,  when  the  crisis  was  intensified  by  the  passage  of 
the  United  States  Tariff  Act  of  1896,  the  United  States  and 
Great  Britain  being  the  largest  sugar-importing  countri.es. 
In  the  United  States,  however,  the  gulf  states  have  for  a  long 
time  bee!i  producers  of  cane  sugar,  although,  as  has  been  stated, 
at  a  disadvantage  as  compared  wuth  tropical  countries,  and 
since  1890  there  has  been  an  increasing  disposition  to  produce 
beet  sugar.  This  country  can  easily  produce  all  the  sugar 
consumed  in  the  world,  the  reason  why  it  has  not  done 
so,  since  beet-sugar  factories  became  established,  being  mainly 
the  high  price  of  labor.  But  on  the  passage  of  the  Tariff 
Act  of  1896,  the  domestic  sugar  producers  demanded  that 
they  should  not  be  compelled  to  compete  in  their  home  market 
with  foreign  sugar,  a  portion  of  whose  cost  was  borne  by  gen- 
eral taxation  of  the  country  which  produced  it,  with  the  result 
that  there  was  incorporated  in  the  law  a  provision  that  in 
addition  to  the  import  duty  collected  on  all  sugar,  there  should 
be  levied,  on  all  sugar  coming  from  a  bounty-paying  country, 
an  additional  duty — called  a  "countervailing  duty" — precisely 
equal  to  the  bounty  paid.  This  at  once  deprived  the  producers 
of  those  countries  of  all  benefit  of  the  bounty  so  far  as  the 
market  of  this  country  is  concerned.  This  led  to  much  ill 
feeling,  especially  on  the  part  of  Germany,  which  was  at  first 
inclined  to  consider  it  a  violation  of  treaty  rights  inviting 
retaliation. 

In  the  meantime  the  sugar  producers  of  the  British  West 
Indian  colonies  were  being  reduced  to  despair  by  the  compe- 


THE    FAllMEK    AND    AN    EXPORT    BOUNTY.  323 

tition  of  the  bounty-aided  beet-sugar  countries,  not  only  in 
the  markets  of  tlie  United  States,  but  even  in  what  they  consid- 
ered tlieir  rightful  "lionie  marlcet" — Great  Britain.  Improve- 
ments in  beet-sugar  processes  have  so  progressed  that  when 
taken  with  the  greater  vigor  inherent  in  the  populations  of 
temperate  climates,  European  beet-sugar  countries  could 
undersell  even  the  well-governed  British  colonies.  A  royal 
commission  visited  the  islands  to  study  the  matter,  and  as  the 
result  of  their  investigations  it  is  deemed  the  policy,  even  of 
the  nation  whose  people  have  most  benefited  by  the  insane 
competition,  that  it  siiould  stop.  The  Government  of  Great 
Britain  does  not  desire  that  the  inhabitants  of  the  British 
Islands  should  be  able  to  obtain  sugar  at  less  than  cost,  at  the 
price  of  the  ruin  of  their  West  Indian  colonies,  whose  staple 
product  is  sugar.  As  a  consequence  of  this  final  cumulation 
of  difficulties,  the  bounty-paying  nations  of  Europe  are  seeking 
by  mutual  agreement  to  abolish  the  system,  the  only  difficulty 
being  to  save,  when  so  doing,  those  engaged  in  the  stimulated 
industry  from  ruin.* 

All  these  matters  are  now  so  well  understood  that  there  is 
no  likelihood  that  the  proposed  plan  of  export  bounties  will 
receive  much  further  attention  in  the  United  States.  The 
system  certainly  has  not  the  slightest  chance  of  being  adopted. 
Producers  of  staple  agricultural  products,  like  all  others,  must 
take  their  stand  one  way  or  another,  upon  the  general  argu- 
ments for  and  against  free  trade  and  protection. 


*  At  the  time  when  the  above  paragraph  was  written  an  International 
Congress  of  the  representatives  of  European  sugar-producing  countries  was  in 
session  in  Brussels,  Belgium,  endeavoring  to  reach  some  plan  by  which  all 
could  simultaneously  discontinue  the  bounties.  They  could  not  agree,  however, 
and  the  conference  came  to  nothing.  In  Great  Britain  the  agitation  for  a 
countervailing  duty  for  the  protection  of  the  British  West  India  Colonies 
continues,  and  will  apparently  result  in  the  levying  of  such  a  duty. 


CHAPTER    III. 

THE    FARMER   AND    THE    SINGLE    TAX. 

HENRY  GEORGE  ("  Science  of  Political  Economy,"  Book 
II,  Chapter  V)  defined  the  "  single-tax  "  doctrine  to  be 
"the  abolition  of  all  taxes  whatever  on  the  making, 
the  exchanging,  or  the  possession  of  wealth  in  any  form,  and 
the  recourse  for  public  revenues  to  economic  rent;  the  net  or 
surplus  product;  the  (to  the  individual)  unearned  increment 
which  attaches  to  land  wherever,  in  the  progress  of  society, 
an}^  particular  piece  of  land  comes  to  afford  to  the  user  supe- 
rior opportunities  to  those  obtainable  on  land  that  any  one 
is  free  to  use." 

The  term  "rent,"  as  employed  in  the  above  definition,  has 
a  meaning  somewhat  different  from  that  given  to  it  in  common 
speech,  and  includes  only  the  sum  paid,  or  which  could  be 
paid,  for  the  use  of  bare  land,  entirely  destitute  of  any  improve- 
ments. The  term  "  ground  rent"  as  used  in  cities  to  denote  a 
sum  paid  for  the  use  of  land  upon  which  to  erect  buildings, 
conveys  some  idea  of  the  meaning  of  the  term  as  used  in 
economic  science,  but  in  common  speech  the  term  "rent"  is 
confined  to  sums  actually  paid  out  for  the  use  of  land,  or, 
indeed,  personal  property,  while  in  economic  science  it  is 
absolutely  restricted  to  land,  but  includes  not  only  sums  paid, 
but  which  could  be  paid;  in  fact,  every  profit  of  any  kind 
which  accrues  to  the  individual  from  the  use  of  land. 

Advocates  of  the  single  tax  hold  that  there  can  be  no  such 
thing  as  ownership  of  land.  Land,  like  air,  should  be  free 
for  all  to  use.  The  custodian  of  the  land  is  the  state,  whose 
sole  duty,  in  respect  to  it,  is  the  regulation  of  its  use.  A 
proper  regulation  is  that  individuals  using  the  land  shall  pay 
to  the  state,  to  be  employed  for  the  public  good,  whatever  profit 
arises  from  its  use.  Those  who  hold  land,  claiming  to  own 
it,  and  therefore  paying  no  rent  to  the  state,  are  held  tx)  be 

(324) 


THE    FARMER    AND    THK    SINGLE    TAX.  325 

robbers,  und  those  holding  this  view  contend  that  the  state 
can  not  too  quickly  perforin  its  duty  by  imposing  a  tax 
upon  land  equal  to  the  entire  profit  which  arises  from  its 
use,*  which  would  yield,  as  they  claim,  a  revenue  quite 
sufficient  to  supply  the  state  with  funds  for  all  public  purposes, 
national,  state,  or  local.  The  term  "land,"  of  course,  in  eco- 
nomic science,  includes  the  entire  surface  of  the  earth,  even 
if  covered  with  water,  so  that  coast  and  river  fisheries,  and 
mines,  would  be  included.  It  docs  not,  however,  include 
buildings,  fences,  orchards,  roads  constructed  by  private 
enterprise,  or  anything  which  is  the  result  of  man's  labor, 
the  theory  being  that  man  is  entitled  to  the  fruits  of  his 
own  labor,  but  that  all  gifts  of  nature  belong  to  the  public 
at  large. 

This  doctrine  is  similar  to  one  of  the  chief  contentions  of 
socialism,  but  single  taxers,  as  such,  differ  from  socialists  in 
not  antagonizing  tiie  idea  of  profit  or  interest.  They  would 
permit  men  to  compete  with  each  other  in  the  products  of 
their  own  labor,  as  to  which  they  may  do  what  they  please, 
but  insomuch  as  they  make  use  of  any  gift  of  nature,  of 
which  the  supply  is  not  unlimited,  as  air,  or  water  where  it 
is  in  abundance,  it  is  insisted  that  the  state  should  be  paid 
all  profit  derived  from  that  source,  the  individual  having 
no  claim  upon  a  farthing  of  it.  "  Franchises"  are  treated 
as  interests  in  land,  and  to  be  taxed  to  the  extent  of  taking 
the  entire  profit  of  quasi-public  corporations,  except  interest 
on  cash  investments. 

The  answer  to  the  contention  of  the  single  taxers,  of  course, 
is  that  whatever  might  have  originally  been  just  with  respect 
to  land,  as  between  individuals  and  the  public,  and  even 
conceding,  which  the  opponents  of  the  theory  do  not  con- 
cede, that  private  ownership  of  land  in  old  countries  origi- 
nated in  robbery,  as  a  matter  of  fact,  society  has  for  ages 
recognized  private  ownership  in  land;  that  upon  the  faith 
of  that  recognition  the  unquestioned  profits  of  labor  have  been 


*Sin^le   taxers   call    this   "restoration;''    their   opponents   call   it  "confis- 
cation." 


326  THE    QUESTIONS    OF    THE    DAY. 

invested  in  its  purchase;  that,  in  particular,  all  the  land  of 
the  United  States,  whose  title  was  once  vested  in  the  people, 
has  been  solemnly  conveyed  by  the  people  to  individuals;  and 
that  the  state  can  not  question  the  title  conveyed  by  itself;  to 
which  the  rejoinder  is  made  that  one  generation  has  no  right 
to  attempt  to  bind  succeeding  generations  by  any  such  promises 
as  this,  and  that  none  of  ns  are  bound  by  any  such  engagements 
of  our  forefathers. 

To  this  it  is  rejoined  that,  even  conceding  the  last  conten- 
tion, which  is  not  conceded  because  it  would  destroy  the  power 
of  defending  national  life  by  creating  national  debt,  it  is  still 
expedient  and  for  the  best  interests  of  society,  that  private 
ownership  of  land  should  continue,  because  only  under  such 
stimulus  will  land  be  put  to  its  best  use,  since  no  one  would 
properly  improve  land  which  he  did  not  own.  To  this, 
however,  the  single  taxers  reply  that  he  could  retain  it  so 
long  as  he  paid  a  just  tax  upon  it,  and  would  be  entitled  to 
all  profits  from  the  use  of  his  improvements  which  he  could 
sell,  as  he  does  now. 

The  arguments  for  and  against  the  expediency  of  the 
single  tax  can  not  be  condensed  into  a  single  chapter.  I 
therefore  do  not  go  further  into  the  merits  of  the  question, 
but  shall  confine  myself  to  some  inquiry  into  the  probable 
effect  of  single  tax  upon  farmers. 

It  is  contended  by  some  advocates  of  tlie  single  tax  that 
labor  devoted  to  commerce  and  manufacturing  yields  far  more 
profit  to  individuals  than  labor  to  the  same  extent  directed  to 
agriculture;  that  this  increase  of  profit  is  due,  mainly,  to  the 
special  advantages  of  location  which  enable  the  operations  of 
commerce  and  manufacturing  to  be  conveniently  carried  on, 
and  that  proper  investigation  would  disclose  that  the  majority 
of  agricultural  land,  not  including  improvements,  yields  little  or 
no  profit  after  defraying  costs  of  living  and  wear  and  tear  of 
improvements,  and  would  therefore  pay  little  or  no  tax ;  and 
that  under  the  operation  of  the  single  tax,  only  the  richest 
and  most  favorably  located  agricultural  lands  would  pay  any 
considerable  tax,  and  they  not  in  excess  of  what  they  now  pay 
on  land,  improvements,  and  personal  property,  and  seldom  so 


THE    FARMER    AND    THE    SIXOLE    TAX. 


327 


much,  but  that  tlie  greater  part  of  the  public  revenue  would 
be  obtained  from  the  taxes  on  town  and  city  property,  manu- 
facturing sites,  mines,  monopolized  fisheries,  and  the  owners  of 
valuable  franchises,  whose  owners  would  pay  to  the  state  the 
entire  rental  value  of  the  property  devoted  to  such  uses,  which 
would  provide  sufficient  revenue  for  most  or  all  purposes  of 
the  state.  While  this  extreme  view  is  held  by  some  it  is 
probable  that  a  majority  do  not  anticipate  so  much  from  city 
property  and  special  privileges,  but  expect  agricultural  lands 
to  bear  some  share  of  the  fiscal  burden.  All  single  taxers 
agree,  however,  in  insisting  that  under  the  single  tax  the 
farmer's  burden  would  be  much  less  than  he  now^  bears. 
This  chapter  will  be  confined  to  a  brief  and  necessarily  super- 
ficial inquiry  into  the  probabilities  in  these  respects. 

The  inquiry  must  necessarily  be  superficial  from  the  fact 
that  as  to  the  United  States,  at  least,  there  are,  except  in  a 
very  few  instances,  no  data  from  w^hich  to  compute  the  rental 
value  of  land  in  either  city  or  country.  It  is  true  that 
we  have  "valuations,"  each  year,  of  all  tlie  property  in  the 
country,  and  every  ten  years  the  census  authorities  do  their 
best  to  reduce  the  conflicting  state  valuations  to  some  common 
denomination,  and  the  result,  whatever  it  is,  is  accepted  as  the 
"true  value"  of  the  various  classes  of  property.  The  "true 
value"  of  property,  however,  is  determined  only  by  the  net 
income  w^hich  it  produces,  or  is  capable  of  producing  under 
proper  management.  The  rental  value  of  laud  is  the  yearly 
sum  which,  under  conditions  as  they  are,  individuals  will  pay 
for  its  exclusive  use,  and  as  a  matter  of  fact  do  pay  when  they 
have  the  opportunity.  If  income  is  known,  a  capital  value 
can  be  fixed  according  to  the  prevailing  rate  of  interest.  If 
interest  is  six  per  cent,  land  is  worth  sixteen  and  two-thirds 
times  the  yearly  rental;  if  five  per  cent,  twenty  times  the 
yearly  rental;  and  if  four  per  cent,  twenty-five  times  the 
yearly  rental.  In  estimates  of  this  kind  it  is  usual  to  reckon 
interest  at  five  per  cent,  and  therefore  to  place  the  value  of 
land  at  twenty  times  its  rental  value  for  one  year.  We  have, 
in  America,  as  to  the  most  part  of  our  land,  no  data  on  this 
subject.     There  is  a  speculative  taint  upon  all  our  land  valua- 


828  THE    QUESTIONS    OF    THE    DAY. 

lions.  For  generaiions  we  have  been  accusLomed  to  think  of 
land  values  in  a  large  way  with  little  or  no  definite  thought  as 
to  income,  or  indeed  any  means  of  ascertaining  it,  since  the 
majority  of  farms  are  occupied  by  their  owners,  who  do  not 
know  what  part  of  their  income  is  attributable  to  their  use  of 
bare  land.  In  the  business  portions  of  large  cities  tl)e  value  of 
ground  rents  is  very  well  known,  but  this  knowledge  grows 
less  as  we  push  into  the  residence  and  suburban  districts, 
and  tends  to  disappear  as  we  get  into  the  country,  where, 
indeed,  there  are  only  the  most  hazy  ideas  of  what  ''rent" 
really  is.  For  the  purposes  of  a  single-tax  discussion,  we  must 
consider  "rent"  as  the  sum  which  a  capitalist  farmer  could 
afford  to  pay  for  a  year's  use  of  bare  land,  in  tlie  expectation 
of  making  a  profit  on  it.  What  some  poor  "cottier"  might 
be  willing  to  pay  for  a  small  patch  for  the  purpose  of  living 
on  it  and  raising  a  crop  is  not  "rent"  in  any  sense  applicable 
to  this  discussion.  As  to  real  "rent"  of  agricultural  land  in 
the  United  States  we  have  almost  no  data,  and  consequently 
none  but  purely  arbitrary  estimates  of  land  value.  Somewhat 
careful  reading  of  a  considerable  number  of  advocates  and 
opponents  of  the  single  tax  leaves  me  wholly  disinclined  to 
accept  the  general  estimates  of  any  of  them  as  a  proper  basis 
of  reasoning.  In  (xreat  Britain,  where  rent  is  actually  paid 
upon  a  great  part  of  the  agricultural  land,  tlie  data  are  of 
course  better,  but  even  there  are  unsatisfactory,  as  land  and 
improvements  are  confounded  in  one  valuation.  Mr.  Thomas 
G.  Sherman*  estimates  that  upon  the  average  of  city  and 
country  lands  sixty  per  cent  of  the  total  rental  of  improved 
lands  is  to  be  considered  as  economic  rent — that  is,  the  rent 
of  the  bare  land,  and  all  his  estimates  of  the  workings  of  the 
single  tax  in  Great  Britain  and  the  United  States,  and  in  city 
and  country,  are  based  upon  that  estimate.  But  certainly  if 
this  approaches  accuracy  for  city  property  it  does  not  do  so  for 
country  property.  Mr.  W.  11.  Mallock,  Edward  Atkinson,  and 
others,  insist  that  the  total  ground  rent  of  the  world  would  not 
pay  the  world's  taxes.     We  not  only  do  not  know  what  the 


Natural  Taxation,"  G.  P.  Putnam's  Sons,  1895. 


THE    FAiniER    A.ND    THE    SINGLE   TAX.  329 

total  economic  rent  is,  but  we  have  no  such  an  approximation 
to  it  as  would  justify  any  opinion,  except  in  a  very  general 
way,  as  to  where  taxation  would  fall  under  the  single  tax. 
We  can  discuss  the  principle,  and  if  just  should  accept  it,  and 
if  unjust  reject  it,  no  matter  what  the  consequences. 

At  the  same  time  it  is  not  unprofitable  to  consider  how 
in  the  light  of  such  information  as  we  have,  the  interests  of 
the  farmers  would  probably  be  aiiected.  To  gather  such  facts 
as  would  justify  a  decided  conviction  is  too  formidable  an 
undertaking  for  any  one  but  an  official  commission.  In  the 
absence  of  such  facts,  while  the  study,  as  stated,  be  super- 
ficial, it  will  not  be  without  its  value.* 

In  considering  this  subject  farmers  must  understand  that 
it  is  not  a  question  of  changing  from  a  just  and  satisfactory 
method  of  taxation  to  one  which  may  prove  otherwise.  The 
present  method  of  raising  state  and  local  revenue  depends 
mainly  upon  a  uniform  ad  valorem  tax  upon  property.  If 
property  were  fairly  assessed  there  could  be  strong  arguments 
both  for  and  against  the  method  as  a  just  and  exj)edient  mode 
of  raising  revenue.  It  is,  however,  notorious  that  assessments 
are  very  unfair,  and  that  the  rich,  to  a  great  extent,  escape 
their  due  share  of  the  burden.  This  is  accomplished  partly 
by  custom,  partly  by  incompetence  of  officials,  partly  by  influ- 
ence, partly  by  bribery,  and  partly  by  perjury.  The  injustice 
of  assessments  and  the  impossibility  of  reform  are  alike  con- 
ceded by  all  investigators.  Ad  valorem  taxes  seem  never 
likely  to  be  more  fairly  assessed  than  now.  Tiiere  is  no 
doubt,  and  nobody  denies,  that  fiirmers  are  the  greatest  suffer- 
ers from  unjust  assessments,  for  the  reason  that  their  property 
is   mostly  visible,  and  its  approximate  value  well  known  to 


*The  single  tax  is  advocated  not,  primarily,  as  a  fiscal  but  a  social  reform. 
Its  advocates  believe  tbat  its  adoption  would  result  in  a  just  distribution  of 
comfort — in  otber  words,  that  it  would  abolish  necessar}^  poverty.  The  best 
exposition  of  the  subject  from  this  standpoint  is  "  Progress  and  Poverty,"  by 
the  late  Henry  George,  a  most  brilliant  book,  to  which  no  adequate  reply  has 
ever  been  made.  I  am  not  able  to  agree  with  Mr.  George  as  to  the  probable 
social  results  of  the  single  tax,  but  wish  every  farmer  might  read  that  book. 
In  the  text  the  subject  is  considered  merely  as  a  revenue  measure. 


330  THE    QUESTIONS    OF    THE    DAY. 

assessors  and  neighbors,  while  the  property  of  the  city  business 
man  is  usually  known  to  nobody  but  himself,  and  if  known 
to  the  assessors  could  not  in  most  cases  be  properly  valued  by 
them.  The  farmer's  personal  property  consists  of  horses,  cattle, 
and  implements,  which  can  be  and  are  counted  and  valued. 
The  merchant's  property  goes  in  as  "stock  in  trade,"  neces- 
sarily at  his  own  valuation.  In  the  matter  of  money  and 
"taxable  credits"  there  are  suppression  and  perjury,*  which 
yearly  increase.  lu  the  city  of  Chicago  in  1894  the  money  of 
bankers  and  brokers  (other  than  national  banks)  was  assessed 
at  only  $43,925,  and  their  "taxable  credits"  at  only  $10,000. 
Aside  from  "brokers"  this  included  twenty-seven  banks  whose 
combined  capital,  surplus,  and  individual  profits  were  $20,464,- 
986.  It  is  probably  true  that  it  was  sought  somewhere  to 
assess  and  tax  the  "stock"  representing  this  large  sum  of 
money,  but  there  is  no  likelihood  that  much  of  it  was  reached. 
At  any  rate  it  can  not  be  traced.  To  suppose  that  those  twenty- 
seven  banks  had  upon  hand  and  subject  to  draft  on  assessment 
day  only  $43,925  is  absurd.  Such  a  statement  made  as  a  fact, 
in  a  morning  paper  of  that  day,  would  have  started  a  "run" 
which  would  have  closed  every  one  of  the  banks  before  night, 
for  at  that  time  the  same  banks  owed  to  depositors  the  prqdig- 
ious  sum  of  $67,272,832,  and  doubtless  had  ample  funds,  which 
the  law  required  them  to  return  for  taxation,  to  meet  all 
demands.  The  l)ank  officers  simply  committed  perjur}^  It 
is  not  likely  that  they  could  have  been  convicted  of  perjury  or 
of  any  other  crime.  The  officers  doubtless  acted  under  legal 
advice,  and  had  a  good  technical  defense.  But  they  com- 
mitted perjury  just  the  same.  That  the  Chicago  estimate  of 
the  value  of  an  oath  has  not  yet  been  reached  by  the  country 
banks  and  bankers  is  shown  by  comparing  the  assessment  of 
money  on  hand  on  the  same  day  in  the  country  banks  of 
Illinois;  out  of  twenty-two  counties — one  of  less  than  twelve 
thousand  population — not  one  showed  so  small  an  amount  of 


*  It  is  perjury  when  the  real  owner  of  property  puts  it  on  the  day  of  assess- 
ment where,  technically,  it  can  not  be  taxed,  and  makes  oath  to  a  return  made 
upon  that  basis. 


THE    FARMER    AND    THE    SINGLE    TAX.  331 

money  on  hand  in  banks  as  the  twenty-seven  strong  state 
banks  of  Chicago.*  The  county  in  which  the  city  of  Peoria  is 
situated  returned  §279,684  in  the  hands  of  banks. 

While  the  instance  given  is  but  one,  although  a  very  bad 
one,  the  reader  may  be  assured  that  it  is  tyiiical.  Tliis  entire 
volume  could  be  filled  with  evidence  officially  gathered,  and 
undoubtedly  true,  that  the  wealthy  men  of  large  cities  do  not 
pay  taxes  on  considerable  portions  of  their  personal  property, 
and  can  not  be  made  to  do  so;  that  those  of  the  smaller  cities 
are  seeking  to  imitate  them,  and  do  so  to  the  extent  that  they 
dare— the  local  assessors  and  the  public  being  better  informed 
as  to  their  assets— and  that  the  evil  is  extending  to  the 
wealthier  citizens  of  the  rural  districts.  In  some  states — and 
in  many  cities — the  assessment  of  personal  property  is  decreas- 
ing year  by  year  as  the  communities  increase  in  wealth  and 
population.  Whatever  burden  is  shaken  off  by  personal  prop- 
erty must  be  assessed  upon  real  estate.  The  owners  of  land, 
however,  in  the  main,  are  also  the  owners  of  personal  property, 
•and,  as  a  matter  of  fact,  doubtless  pay  fully  three-fourths  of 
the  personal  taxes.  There  are  many  persons  who  are  not 
"single  taxers"  who  believe  (and  for  many  reasons  not  here 
stated  t)  that  it  does  not  pay  to  try  to  tax  personal  property, 
and  that  it  would  be  better  for  all  concerned  if  personal  prop- 
erty were  relieved  from  all  taxation.  I  am  here,  however,  only 
showing  that  the  present  system  of  taxation  is  bad  for  the 
farmer. 

I  can  not,  however,  leave  the  subject  without  saying  that 
the  farmer  himself  is  to  blame  for  a  great  part  of  this  evasion. 
Much  of  the  taxation  which  the  farmer  most  earnestly  demands 


*For  a  great  mass  of  statistics  on  this  point  see  Eeport  of  Illinois  Bureau  ot 
Labor  Statistics,  1894,  from  which  the  figures  in  the  text  were  obtained. 

f  Any  adequate  exposition  of  the  difficulties  attending  the  subject  of  taxa- 
tion, or  of  the  principles  or  possibility  of  scientific  taxation,  would  expand  this 
chapter  to  a  book,  of  which  there  already  are  abundance.  For  one  thing  the 
farmer  above  all  things  wishes  to  see  "  money  "  taxed,  and  at  the  same  time  is 
equally  anxious  to  have  money  "cheap."  But  to  tax  money  is  to  make  it  dear, 
and  to  tax  it  more  than  property — and  it  always  is  so  taxed  since  it  is  assessed 
at  full  value — is  to  make  it  scarce  by  driving  it  out  of  the  country. 


332  THE   QUESTIONS   OF   THE    DAY. 

is  very  unjust  taxation,  and  when  the  law  imposes  it  the  vic- 
tims soothe  their  consciences  with  the  thought  that  if  they  do 
employ  perjury  and  bribery  it  is  only  to  escape  an  injustice 
not  otherwise  avoidable.  For  example, "  stocks  "  and  "  bonds  " 
are  considered  by  nearly  all  farmers  as  eminently  proper  sub- 
jects of  taxation.  Now  this  can  only  be  because  they  do  not 
realize  what  stocks  and  bonds  really  are.  Let  us  suppose  that 
ten  gentlemen  in  Boston  decide  to  build  a  railroad  in  Cali- 
fornia. They  have  not  the  money  to  complete  the  road,  but 
they  have  enough  to  make  a  good  start,  and  rely  upon 
borrowing  what  is  required  to  complete  it.  They  organize  a 
company  and  put  in  $2,000,000.  For  the  money  they  put  in, 
which  is  probably  not  in  equal  amounts,  they  must  have 
something  to  show,  for  which  purpose  "stock"  is  issued  to 
each  one  for  the  amount  which  he  paid  in.*  This  stock  is 
merely  a  written  statement  that  the  holder  has  paid  in  the 
amount  stated  on  its  face  towards  building  the  railroad.  The 
actual  property  would  be  in  California.  Let  us  now  suppose 
that  when  the  |2,000,000  is  exhausted,  the  company— that  is, 
the  stockholders — borrow  of  twenty  gentlemen  in  New  York 
$8,000,000  to  complete  the  road  and  do  complete  it  and  put  it 
in  operation  for  that  money.  To  secure  the  people  who  lend 
the  money  the  company  gives  its  note,  which,  in  the  case  of 
railroads,  is  for  some  renson  called  a  "bond"  instead  of  a  note, 
and  a  mortgage  upon  the  railroad.  The  bond  is  evidence  that 
the  sum  named  in  it  has  been  expended  on  a  railroad  in  Cali- 
fornia, and  the  whole  value  of  the  bond  depends  upon  the 
ability  of  tlie  property  which  it  represents  to  pay  interest. 
Under  these  circumstances  the  Boston  gentlemen  who  supplied 
the  original  $2,000,000  would  own  one-fifth  of  the  road,  and 
retain  the  right  to  manage  and  operate  it  so  long  as  they  paid 
interest  on  the  borrowed  mon-ey  and  no  longer.  The  New 
York  people  would  own  the  other  four-fifths,  and  could  take 


*  It  would  probably  be  issued  for  an  amount  a  good  deal  more  than  was 
paid  in,  upon  the  plea  that  the  "  franchise  "—that  is,  the  right  to  build  and 
operate  the  road,  and  to  condemn  land  for  its  use,  was  worth  a  great  deal  of 
money,  which  might  or  might  not  be  the  case.  For  the  purpose  of  the  text  I 
prefer  to  consider  that  the  stock  issued  represents  actual  cash  and  nothing  else. 


THE    FARMER   AND    THE   SINGLE   TAX.  333 

the  whole,  if  the  company  failed  to  pay  interest.  The  stock 
and  bonds  aUke  are  simply  evidence  of  interests  in  property 
located  in  California. 

Now  in  this  case  it  is  only  the  railroad  itself  that  can  pay 
any  taxes.  The  stock  and  bonds  earn  nothing  but  what  the 
railroad  earns  for  them.  But  the  railroad  is  in  California, 
and  the  authorities  of  that  state,  finding  it  there,  tax  it  for 
$10,000,000,  which  it  cost.  The  New  York  assessor,  however, 
linds  certain  of  its  citizens  with  evidence  of  ownership  in  a 
railroad  some  thousands  of  miles  away,  and  taxes  them  upon 
$8,000,000,  while  the  Boston  assessor  is  equally  prompt  in 
taxing  the  $2,000,000  owned  in  Boston.  These  gentlemen  all 
vigorously  protest  that  all  that  they  own  is  a  railroad  in  Cali- 
fornia, which  is  taxed  already  in  California,  but  it  avails  them 
nothing.  So  far  as  the  assessor  can  find  the  stock  and  bonds 
they  are  taxed.  This,  if  there  is  an  honest  assessment  in  each 
state,  is  certainly  double  taxation,  and  will  be  evaded  so  for  as 
possible,  even  by  improper  means.  The  case  of  a  mortgaged 
farm  is  precisely  similar.  A  farmer  with  a  farm  worth  $4,000 
may  mortgage  it  for  $2,000,  thereby  parting  with  one-half  his 
property,  while  retaining  the  control  of  the  whole  so  long  as 
he  pays  interest.  He  pays  taxes,  however,  in  most  states,  upon 
the  whole  farm  as  if  he  owned  it  all,  while  the  owner  of  the 
mortgage,  if  he  can  be  found,  is  taxed  on  $2,000  additional. 
If  the  assessment  is  honest,  taxes  are  collected  on  $0,000,  wdien 
there  is  really  but  $4,000  to  be  taxed.* 

If  a  manufacturer  of  agricultural  implements  sells  j)lo\vs 
to  the  value  of  $1,000  to  a  local  dealer,  and  takes  his  note  at 
six  months,  he  is  taxed  on  the  note.     If  the  dealer  sells  them 


*In  California,  and  possibly  in  other  states,  the  mortgage  is  assessed  to  its 
owner  as  appears  by  the  county  records,  who  pays  the  tax  on  the  face  value  of 
the  mortgage,  the  owner  of  the  equity  being  taxed  only  on  the  ditference 
between  the  face  of  the  mortgage  and  assessed  valuation  of  the  farm.  This  is 
a  correct  principle,  but  it  did  not  accomplish  what  it  was  intended  for.  It  was 
demanded  by  the  farmers  in  order  to  reduce  interest  by  making  the  mortgagee 
pay  this  tax.  As  a  matter  of  fact  the  tax  is  added  to  the  interest  and  a  little 
more  for  contingencies.  The  mortgage  is  taxed  at  its  full  face  value,  while  the 
land  in  excess  of  the  mortgage  is  assessed  much  lower. 


334  THE    QUESTIONS    OF    THE    DAY. 

promptly  to  one  hundred  farmers  for  $1,500  and  takes  their 
notes  he  is  taxed  upon  them;  and  the  plows  are  taxed  iu  the 
hands  of  the  farmers  where  the  assessor  finds  them.  The  only 
property  whose  use  can  earn  the  taxes  is  the  plows.  In  this 
case  it  is  treble  taxation.  These  illustrations  might  be  multi- 
plied indefinitely.  What  have  been  given  are  sufficient  to 
show  the  nature  of  the  unjust  taxation  which  the  farmer 
demands,  and  of  wliicli  he  is  sometimes  the  victim.  It  ia 
demands  of  this  kind  which  serve  as  an  excuse  to  rich  men 
for  evading  taxes.  The  farmer  claims  that  the  rich  do  not 
pay  their  just  share  of  taxes,  and  it  is  true,  but  the  way  to 
reach  them  is  not  by  double  taxation.  If  it  be  asked  how  we 
are  to  reach  them,  the  reply  is  that  that  is  one  of  the  most 
vexing  questions  in  political  economy,  and  not  to  be  fully 
dealt  with  in  a  chapter.  We  are,  however,  in  this  chapter, 
considering  one  method  which  is  strongly  urged  as  certain  to 
accomplish  the  desired  end. 

Conceding  for  the  moment  that  taxes  on  personal  property 
are  to  be  abandoned,  the  farmer  will  find  that  in  the  assessment 
.  of  real  estate,  city  property  is  greatly  undervalued  as  compared 
with  rural  land.  The  evidence  upon  this  point  is  abundant, 
but  the  most  striking  case  that  I  know  of  is  disclosed  in 
a  report  (1894)  of  the  Illinois  Bureau  of  Labor  statistics.  This 
is  a  volume  of  over  four  hundred  pages  entirely  devoted 
to  the  statistics  of  the  taxation  of  real  estate  and  improve- 
ments in  the  city  of  Chicago,  in  comparison  with  taxation  in 
other  parts  of  the  state.  The  assessed  valuations  are  also 
compared  with  true  valuations  in  a  great  number  of  cases,  the 
true  valuations  being  based  not  on  estimate,  but  on  actual 
transactions.  One  of  the  most  remarkable  cases  described 
is  that  of  a  lot  containing  eight  thousand  two  hundred 
thirty-five  square  feet — a  little  less  than  one-fifth  of  an  acre — 
which  had  just  been  leased  for  ninety-nine  years  at  an  average 
rental  of  $78,011.  Assuming  interest  to  be  5  per  cent,  the 
value  of  this  lot  is  $1,572,220,  which  is  obtained  by  multiply- 
ing its  annual  rental  by  twenty.  It  was  assessed  in  1893  at 
$89,952,  or  5.72  per  cent  of  its  value.  Assuming  the  land 
adjoining  to  be  equally  valuable,  which  it  is  not,  the  lot  in 


THE    FAKMEll    AND    THE    .SJXtilJ';    TAX.  335 

question  being  perhaps  the  most  valuable  corner  lot  in  Chicago, 
an  acre  located  there  would  exchange  for  two  hundred  tilly- 
three  thousand  seventy -seven  acres  of  Illinois  farm  land  at 
$32.87  per  acre,  that  being  the  average  estimated  value  of 
farm  lauds  in  Illinois.  No  property  in  Illinois  is  pretended  to 
be  assessed  at  its  true  value,  but  assuming  farm  lands  in  that 
state  to  be  worth  as  estimated,  and  as  seems  reasonable  to 
believe,  $32.87  per  acre,  they  are  assessed  at  27.75  per  cent  of 
their  true  value  as  against  5.72  per  cent  of  its  true  value  for 
this  piece  of  fancy  city  proi)erty.  The  re})ort  in  question 
shows  almost  equal  unfairness  in  all  the  Chicago  assessments 
as  compared  with  country  property.  It  may  be  claimed,  and 
it  may  be  true,  that  Chicago  property  is  more  grossly  under- 
valued for  assessment  than  that  of  any  other  city,  but  no  one 
familiar  with  the  facts  as  they  exist  throughout  the  country 
will  doubt  that  city  property  generally  is  greatly  undervalued 
as  compared  with  rural  property,  and  the  farmers  thereby 
burdened  with  a  wholly  undue  share  of  the  burden  of  support- 
ing the  government.  Whatever,  therefore,  their  conclusion 
may  be,  they  can  approach  the  subject  of  the  single  tax  on 
ground  rents,  as  a  fiscal  measure,  without  any  prejudice 
in  favor  of  the  abominably  iniquitous  system  which  now 
oppresses  them. 

In  1890  about  one-fourth  of  the  ad  valorem  taxes  levied  in 
the  United  States  were  assessed  upon  personal  property,  and 
three-fourths  upon  real  estate.  From  what  has  been  said  it  is 
evident  that  the  ratio  of  taxes  paid  by  real  estate  is  constantly 
increasing.  The  single  tax,  considered  as  a  fiscal  measure, 
and  not  as  a  question  of  social  reform,  involves  abandoning 
the  attempt  to  collect  taxes  on  personal  property,  placing  ur)on 
ground  rents  the  entire  burden  now  borne  by  real  and  i)ersonal 
property,  and  adding  thereto  all  the  taxes  now  produced  by 
tariffs  and  other  indirect  taxation,  poll  taxes,  and  licenses. 
I  do  not  understand  it  to  include  the  abolition  of  postage,  and 
other  sums  paid  by  individuals  to  the  government  for  services 
rendered.  Excluding  postage,  seigniorage  on  silver,  and  some 
other  items,  the  total  taxation,  local,  state  (ad  valorem),  and. 
national,  in  the  United  States,  in  1890,  was  $852,459,405.     The 


336  THE   QUESTIONS   OF    THE   DAY. 

estimated  "true  value"  of  all  real  estate  and  improvements 
was  $39,544,544,333,  of  which  $13,137,145,842  was  for  "  farms" 
of  thirty  acres  or  more.  If  the  ratio  of  improvements  to  land 
was  the  same  as  in  California  in  189G*  (37.2  per  cent)  the  value 
of  the  land  alone  was  $24,933,973,842,  and  the  rate  of  tax  on 
land  alone  to  produce  the  sum  raised  by  national  and  ad 
valorem,  state,  and  local  taxation  would  have  been  $3.40  on 
$100,  or  3.4  per  cent.  The  total  rental  value  of  the  land, 
assuming  interest  to  be  5  per  cent,  was  $1,246,668,692.  The 
taxation  of  that  year  would  not,  therefore,  have  consumed  the 
entire  rental  value  of  land.  This,  however,  gives  no  indica- 
tion of  how  the  burden  would  have  been  divided  between 
city  and  country. 

I  am  not  aware  of  any  statistics  of  assessments  and  taxa- 
tion within  the  United  States  which  give  a  better  indication 
of  the  probable  results  of  the  single  tax  as  a  fiscal  measure 
than  those  of  California.  Since  1879  all  land  in  California  is 
assessed  separately  from  the  improvements  upon  it,  and  "city 
and  town  lots"  are  consolidated  in  the  returns  separately  from 
other  real  estate.  All  property,  also,  is  required  to  be  assessed 
at  its  "actual  cash  value,"  which  in  an  ultimate  analysis  must 
mean  a  certain  number  of  times  the  cash  rent  which  is  paid, 
or  might  be  obtained  for  it.  If  interest  is  assumed  to  be  five 
per  cent,  the  "cash  value"  would  be  twenty  times  the  annual 
rent  which  could  be  paid  for  the  use  of  the  property.  As  a 
matter  of  fact  property  is  not  assessed  at  its  true  value,  espe- 
cially city  property,  nor  can  its  true  value  be  known  in  many 
cases,  because  the  income  which  it  yields  is  not  known.  As 
in  other  states,  the  cities  are  doubtless  regularly  undervalued. 
Still,  the  State  Board  of  Equalization  seeks  to  remedy  this, 
and  the  fact  that  in  1890  real-estate  values  in  California  were 
grossly  inflated  both  in  city  and  country,  and  that  the  item 
"city  and  town  lots"  includes  large  areas  of  what  was  really 
farm  property,  incline  me  to  consider  the  real-estate  assess- 
ment of  California  in  1890  as  nearer  to  the  "true  value"  of 


*In  the  older  and  colder  states  the  ratio  of  improvements  would  be  greater, 
and  the  land  tax  rate  would  be  higher. 


THE    FARMER    AND    THE    SINGLE    TAX.  337 

the  property  than  any  other  assessment  or  estimate  that  I 
have  seen.  It  has  the  advantage  of  being  a  regular  assess- 
ment, and  not  a  single  special  inquiry,  and  was  made  after 
eleven  years'  experience,  largely  by  the  same  officials,  in  the 
valuation  of  property  on  that  plan.  The  assessors  were  at 
least  ''sworn"  to  assess  at  true  value  if  they  could  find  it. 
Railroads,  which  are  treated  by  single  taxers  as  "land,"  were 
separately  assessed,  but  as  I  do  not  believe  that  the  bare  land 
used  by  the  railroads — except  street  railroads— of  the  state 
yielded  any  rental,  after  paying  fair  interest  on  honest  cost,  I 
do  not  include  them  as  taxable  real  estate.  The  street  rail- 
roads, also  not  assessed  as  real  estate,  doubtless  had  a  value  to 
be  reckoned  as  land  rent,  blit  as  I  have  no  means  of  ascertain- 
ing the  aggregate,  I  can  not  include  them.  With  the  exception 
of  a  few  lines,  the  street  railroads  could  not  pay  much  rent, 
and  it  would  make  no  great  difference.  Still,  whatever  their 
rent  was  should  be  included  as  taxable,  from  a  single-tax 
standpoint.* 

The  state  and  local  taxes  in  1890,  in  California,  aggregated 
$18,754,850.  The  federal  taxation  of  that  year  was  $381,094,- 
265.  The  population  of  California  was  1.9  per  cent  of  that  of 
the  United  States.  Adding  to  the  state  and  local  taxes  $7,240,- 
791,  which  is  1.9  per  cent  of  the  federal  taxation,  there  is 
a  total  of  $25,995,041  to  be  assessed,  upon  single-tax  prin- 
ciples, upon  the  real  estate,  not  including  improvements,  of 
the  state. 

Unfortunately  the  California  reports  of  1890  do  not  segre- 
gate the  real  estate  from  improvements,  as  they  have  since 
done,  and  I  am  compelled  to  take  the  returns  for  1891,  which 
are  much  higher,  although  the  property  assessed  was  the  same. 
The  State  Board  of  Equalization  that  year  took  great  pains  to 
ascertain  what  w^as  the  "true  value"  of  the  property  assessed, 
according  to  their  judgment,  and  raised  the  assessment  in  San 
Francisco  as  returned  to  them,  thirty  per  cent,  and  that  of 
Los  Angeles  County  fifteen  per  cent.  The  equalized  assess- 
ment for  1890,  of  real  estate   and  improvements,  was  $891,- 


•  This  omission  of  property  is  offset  by  the  omission  of  poll  and  license  taxes. 

22 


Job  THE    Ql'ESTIONS    OF    THE    DAY. 

449,172.*  The  equalized  valuatioi]  of  the  same  property  fui 
1891  was  $1,013,394,461,  an  increase  of  $121,945,209.  If  it 
was  really  a  "true  valuation"  in  the  sense  that  single  taxers 
use  the  word,  that  is,  free  from  any  speculative  taint,  it  should, 
at  five  per  cent,  have  yielded  or  earned  a  net  income  of 
$50,669,723.  In  my  judgment  single  taxers  could  well  afford 
to  accept  the  valuation  of  1891  as  really  the  "true  value"  of 
everything  which  they  would  call  "land" — and  as  I  write  this 
I  have  no  idea  how  the  tax  is  coming  out,  for  I  have  not  yet 
made  the  computation. 

The  equalized  value  of  "city  and  town  lots"  without  im- 
provements was  $348,763,183.  If  the  local  state  and  national 
tax  of  1891  of  $25,995,641  had  been  assessed  on  city  and  town 
lots  alone,  the  rate  would  have  been  $7.10  on  $100,  or  7.1  per 
cent.     No  other  property  would  have  been  taxed  at  all. 

The  total  assessment  of  real  estate  without  improvements, 
including  farm  property  and  city  and  town  lots,  was  $764,311,- 
877.  If  the  national  state  and  local  taxes  had  been  assessed 
on  this  property  the  rate  would  have  been  $3.40  on  $100,  or 
3.4  per  cent.  The  averaged  equalized  value  of  country  lands 
taxed  in  1891  was  $11.56  per  acre.  Under  the  single  tax  land 
owners  would  have  paid  an  average  rental  to  the  state  of  39.3 
cents  per  acre,  and  paid  no  other  tax — local,  state,  or  national.f 
Of  course  some  would  have  paid  more  and  others  less. 

The  total  assessed  valuation  of  all  property  in  California, 


*The  "true  valuation  "  of  real  estate  and  improvements  subject  to  taxation 
in  California  in  1890  is  given  in  the  census  returns  as  $1,517,565,300,  which 
gives  an  average  value  per  acre  for  the  land  taxed  of  $35.27,  To  those  who 
know  California  and  have  viewed  the  enormous  areas  of  taxed  land  which  is 
worth  almost  nothing,  any  such  valuation  is  sufficiently  absurd.  If  from  this 
"true  valuation  "  the  total  equalized  assessed  value  of  city  and  town  lots  be 
deducted,  and  the  remainder  divided  by  thirty-five  million  nine  hundred  fifty 
thousand  four  hundred  sixteen — the  number  of  acres  assessed  in  1891 — the  -value 
per  acre  of  country  lands  will  appear  as  $32.79,  which  at  five  per  cent  should 
give  a  rental  value  of  $1.64  per  aero.  The  areas  of  arid  and  almost  worthless 
land  are  so  large  in  California  that  $15  to  .'$18  per  acre  for  land  and  improve- 
m(fnts  is  quite  high  enough  for  an  estimated  avci'age. 

t  These  computations  do  not  include  poll  or  license  taxes,  as  data  are  not 
available. 


THE    FARMER    AND    THE    SINGLE    TAX.  339 

after  equalization,  in  1891,  was  $1,275,832,510.  If  the  total 
local  state  and  national  tax  had  been  levied  on  the  valuation 
the  rate  would  have  been  about  $2.00  on  the  $100,  or  two  per 
cent  upon  all  property  at  very  nearly,  at  least,  its  true  valua- 
tion. This  is  a  very  serious  burden,  which  tends  to  increase 
annually  as  we  require  more  and  more  of  our  local  govern- 
ments, and  as  a  nation  concern  ourselves  more  with  the  affairs 
of  mankind. 

The  tax  levied  in  1891  in  California  for  state  purposes 
alone  was  $4,873,848.  Had  this  tax  been  levied  on  city  and 
town  lots  alone  the  rate  would  have  been  $1.39  on  $100.  Had 
it  been  levied  on  all  real  estate,  without  improvements,  the  rate 
would  have  been  63  cents  on  $100,  in  these  and  other  similar 
supposed  cases,  no  other  property  being  taxed.  The  actual 
rate  levied  on  all  property  in  the  state,  for  state  purposes  only, 
was  44.6  cents  on  the  $100. 

A  somewhat  clearer  view  may  be  obtained  by  arranging 
some  of  these  figures,  subject  to  the  assumptions  in  the  test,  in 
tabular  form. 


The  single-tax  theory  applied  to  United  States  and  California 
valuations  of  1890,  the  California  assessment  being  that  of 
1891,  and  the  total  taxation  as  given  in  census  returns  of 
1890:— 

California.  United  States. 

True  value  of  land  without  improvements $1,013,394,461        $23,933,973,842 

Rental  value  at  5  per  cent  50,609,723  1,246,668,692 

Total  tax,  local,  state,  and  national 25,995,641  852,459  405 

Rate  to  raise  the  tax  if  levied  on  land  without 

improvements $3.40  on   flOO  $3.40  on  $100 

Rate  to  raise  tax  if  levied  on  true  value  of  all 

property $2.00   on   $100  $2.15  on  $100 

Rate  to  raise  tax  if  levied  on  city  and  town 

lots  only $7.10    on  $100  

Total  tax  for  state  purposes  only,  California, 

1891 $4,873,848  

Rate  of  tax  if  levied  on  city  and  country  land 

with'out  improvements $0.63    on  $100 

Actual  rate  levied  on  all  property  for  state 

purposes  only $0,446  on  $100  


340  THE    QUESTIONS    OF    THE    DAY. 

In  1890  there  was  collected  of  ad  valorem  taxes  in  the 
United  States  about  $3.00  from  real  estate  and  improvements 
to  $1.00  on  personal  property.  Assuming  that  California 
farmers  paid  the  average  tax  on  personal  property,  a  farmer 
owning  land  and  improvements  assessed  at  $6,000  should  have 
been  assessed  on  $2,000  jiersonal  property.*  Of  his  total  real- 
estate  assessment,  if  he  was  an  average  man,  $5,160  should 
have  been  upon  land,  and  $840  upon  improvements.  Under 
laws  as  they  are  he  was  taxed,  for  state  purposes  only,  at  tlie 
rate  of  44.6  cents  on  $100  and  his  total  tax  was  $35.68.  Under 
the  single  tax  he  would  have  paid  63  cents  upon  the  $100  on 
the  valuation  of  his  land  only,  which  was  $5,160,  and  his  tax 
for  state  purposes  would  have  been  $32.50.  This  being  the 
tax  of  the  average  man,  it  would  appear  that  farmers  having 
the  best  land  would  pay  somewhat  more  than  they  now  pay, 
and  those  having  the  poorest  land  considerably  less.  It  seems 
to  me  quite  probable  that  this  would  be  the  usual  result.  It 
seems  evident  to  me  that  if  all  taxation  was  collected  from  city 
and  town  lots,  the  tax  would  exceed  the  rental  value. 

The  proposal  to  confine  taxation  to  land  valuesf  is  more  than 
a  century  old,  but  it  seems  also  to  have  been  original  with 
Henry  George,  who,  in  "Progress  and  Poverty,"  without  being 
aware  of  the  earlier  proposals,  first  brought  it  prominently 
before  tlie  world.  As  already  stated,  Mr.  George  advocated  the 
single  tax  as  a  means  of  social  reform  ratl)er  than  as  a  method 
of  raising  revenue,  and  his  discussion,  from  a  fiscal  standpoint, 
is  not  satisfactory.     While  the  work  of  Mr.  George  is  neces- 


*The  personal  property  taxed  in  California  in  1890  was  16  per  cent  of  the 
real  estate  and  improvements.  In  the  rural  districts  it  was  more  and  in  cities 
less.  It  is  not,  however,  likely  that  it  was  anywhere  near  33|  per  cent  as 
assumed  in  the  tax.  In  1861  the  personal  property  assessed  was  49.62  per  cent 
of  real  estate,  from  which  it  has  declined  regularly  to  14.03  per  cent  in  1896. 

f  Single  taiersdraw  a  sharp  distinction  hetween  "land"  and  "  land  values." 
They  would  tax  no  land  for  which,  exclusive  of  all  improvements  which  are 
the  result  of  man's  labor,  the  user  could  not,  after  defraying  all  expenses, 
including  his  own  labor,  afford  to  pay  a  cash  rent.  This  rent,  whatever  it 
might  be,  would  be  the  tax. 


THE    FARMER    AND    THE   SINGLE   TAX.  341 

sarily  controversial,  it  is  brilliant,  and  bears  evidence  of 
earnest  conviction.  Of  the  innumerable  "replies"  to  Mr. 
George,  all  that  I  am  familiar  with  are  too  ill-tempered  to  be 
commended  to  the  general  reader.  While  I  think  him  entirely 
in  the  wrong  as  a  social  philosopher,  it  seems  to  me  that  the 
convincing  reply  can  only  come  from  one  who  to  the  necessary 
ability  adds  the  same  earnest  desire  for  the  welfare  of  the 
unfortunate  classes  that  is  evident  in  the  life  and  work  of 
Mr.  George. 


CHAPTER    IV. 


IF  I  have  sheep  to  spare  and  need  wheat  I  do  not  have  to 
find  one  who  has  wheat  to  sell  and  needs  sheep;  whoever 
needs  sheep  will  give  me  money  and  with  the  money  I 
can  buy  wheat.  One  of  the  functions  of  money  in  this  trans- 
action is  that  of  a  "medium  of  exchange."  In  common  lan- 
guage I  am  said  to  turn  my  sheep  into  money  and  my  money 
into  wheat. 

In  regard  to  money  as  a  medium  of  exchange  there  are 
always  questions  of  convenience  arising,  as,  for  example,  with 
reference  to  its  form,  denominations,  and  the  like,  and  with 
respect  to  paper  money,  the  question  of  responsibility — that 
is  whether  it  shall  be  issued  by  banks  or  government — seems 
to  me  connected  mainly  with  this  function;  with  this  excep- 
tion, however,  which  has  been  discussed  in  another  cliapter, 
there  is  no  "Question  of  the  Day"  in  regard  to  money  as  a 
medium  of  exchange;  such  questions  as  arise  are  settled  by 
the  authority  whose  duty  it  is  to  deal  with  them,  with  little  or 
no  concern  on  the  part  of  the  public. 

The  usefulness  of  money  as  a  medium  of  exchange,  how- 
ever, involves  one  characteristic  which  all  good  money  pos- 
sesses, and  without  which  it  is  not  good  money ;  it  must  be 
something  which  every  one  is  willing  to  take  in  exchange  for 
whatever  he  has  to  part  with.  I  do  not  mean  something 
which  some  are  willing  to  take,  or  all  are  willing  to  take  for 
some  things,  or  which  all  ought  to  be  willing  to  take,  but  some- 
thing which  as  a  matter  of  fact  all  are  willing  to  take  at  all 
times. 

The  only  substances  which  all  men  are  willing  at  all  times 


also  Book  Fourth,  Chapter  I  and  Appendix  G. 
(342) 


THK    FARMKK    AND    TIIK    ('rRKKNCY. 


343 


to  take  in  exchange  for  all  commodities  are  the  precious 
metals — gold  and  silver.  These  constitute  what  is  called 
international  money  because  they  are  recognized  as  money 
by  all  civilized  nations.  Considered  merely  as  instruments  of 
exchange  these  metals  constitute  the  best  money. 

Instead  of  the  metals  themselves,  promises  to  pay  the 
metals,  in  the  form  of  notes  issued  by  responsible  governments 
or  banks,  are  more  convenient  when  large  sums  are  involved, 
and  are  preferred  by  some  for  use  even  in  small  amounts  ; 
these  constitute  good  money  so  long  as  they  can  as  a  matter 
of  fact  be  exchanged  at  any  time  for  the  metals  which  they 
represent,  and  so  long  as  everybody  believes  they  can  be  so 
exchanged.  Such  notes  constitute  what  is  called  "represent- 
ative money."  If,  as  a  matter  of  fact,  they  can  not  be 
exchanged,  on  demand,  for  what  they  represent,  these  notes 
are  not  really  good  money,  even  though  they  are  believed  to 
be,  and  perform  the  office. of  good  money  until  their  true 
character  is  discovered.  A  counterfeit  note  does  the  work 
of  good  money  until  it  is  found  to  be  counterfeit,  when  it 
immediately  loses  its  value. 

A  note  that  can  really  be  exchanged  for  the  metal  it  repre- 
sents is  not  good  money  if  any  one  to  whom  it  is  offered 
doubts  whether  he  can  get  coin  for  it  on  demand  or  fears  that 
he  might  not  be  able  to  make  the  demand.  No  farmer  in  the 
United  States  doubts  that  if  he  should  present  a  note  of  the 
Bank  of  England  at  the  counter  of  the  bank  he  would  get 
gold  for  it,  but  he  can  not  go  to  the  Bank  of  England,  and 
he  may  not  find  any  one  who  can  conveniently  send  it  there, 
and,  not  being  familiar  with  its  appearance,  he  might  fear  that 
it  might  be  counterfeit,  and  so  might  be  unwilling  to  receive 
it,  even  although  actually  good  ;  a  United  States  "greenback" 
would  be  in  a  similar  .situation  in  England,  while  each  will 
circulate  freely  in  its  own  country.  No  merely  representative 
money  is  therefore  "  international  money,"  although  the  notes 
of  contiguous  nations  often  circulate  readily  among  them- 
selves, as  those  of  France  and  Belgium  and  the  United  States 
and  Canada  do  to-day.  Circumstances,  however,  are  at  any 
time  liable  to  arise  to  prevent  the  convenient  return  of  repre- 


344  THE    QUESTIONS    OF    THE    DAY. 

sentative  money  to  the  place  of  redemption,  so  that  it  never 
is  certain  to  be  at  all  times  the  best  money. 

Sometimes  national  or  bank  notes  are  known  not  to  be 
redeemable  according  to  their  face  at  the  time,  and  yet  it  is 
believed  in  regard  to  them  that  they  will  sometime  be  re- 
deemed. That  was  the  case  with  United  States  "greenbacks" 
for  many  years  after  1861,  and  is  the  case  with  regard  to  the 
notes  of  many  'other  countries  to-day.  Such  notes  may  still 
be  good  money,  or  they  may  not.  If  no  more  are  issued  than 
would  represent  the  metallic  money  which  would  have  circu- 
lated had  no  paper  money  been  issued,*  it  is  the  opinion  of 
most  economists  that  they  would  circulate  as  freely  as  if 
actually  redeemable,  and  be  "good  money"  in  the  sense  of 
being  able  to  buy  as  much  as  the  coin  wiiich  they  represent. 
As  no  such  experiment  has  ever  been  made,  however,  we  do 
not  actually  know  this;  no  nation  refuses  to  redeem  its  paper 
money  if  it  can  help  it,  and  no  nation,  once  started  in  the  prac- 
tice of  issuing  currency  not  actually  redeemable  on  demand, 
has  ever  yet  refrained  from  issuing  very  much  more  than  the 
coin  which  would  have  circulated  in  the  absence  of  paper 
money.  When  this  happens  the  paper  money  still  circulates, 
but  not  at  its  face  value.  It  is  said  to  be  "inflated."  It  ceases 
to  be  even  good  national  money.  It  is  received  at  some  lower 
value,  which  is  fixed  partly  by  the  general  opinion  as  to  tlie 
probability  of  its  ultimate  redemption,  but  more  especially  by 
the  amount  of  excess  issues.  The  larger  the  issue  the  greater 
the  depreciation.  I  shall  discuss  this  further  in  connection 
with  the  functions  of  money  other  than  as  a  medium  of 
exchange.  A  familiar  instance  of  excessive  issue  is  our  green- 
back and  national  bank  circulation  issued  during  the  Civil 
War.  Probably  few  doubted  the  ultimate  redemption,  in  coin, 
of  all  pa])er  money  there  issued,  by  the  United  States,  but  at 


*  Under  ordinary  circumstances,  when  nothing  impedes  the  natural  flow 
of  undepreciated  money,  there  will  always  he  present  sufficient  to  make  the 
exchanges,  just  as  there  will  he  food  to  eat  and  clothes  to  wear.  As  the  people 
need  it,  somehow  they  will  get  it.  There  will  he  something  for  sale,  and  those 
who  wish  to  huy  will  send  money  to  pay  for  it. 


THE  FARMER  AND  THE  CURRENCY.  345 

one  time  one  gold  or  silver  dollar  would  buy  two  and  one-half 
times  as  much  as  a  paper  dollar.  This  was  the  result  of 
excessive  issues.  When,  however,  it  becomes  evident  that 
representative  money  will  never  be  redeemed,  it  very  soon 
loses  all  value.  "Confederate"  bills,  after  Appomattox,  were 
known  to  be  valueless,  and  nobody  would  take  them  at  any 
price.  Until  other  currency  could  be  provided  such  exchanges 
as  were  necessary  took  place  by  means  of  barter,  w^hich  is  the 
exchange  of  one  commodity  for  another.  But  wliere  there  are 
goods  to  be  exchanged  there  money  will  go,  and  there  was 
very  soon  other  money  in  circulation. 

Money  is  an  element  so  essential  to  the  transaction  of 
modern  business — barter  being  so  extremely  inconvenient — 
that  no  community  will  do  without  it.  If  gold  and  silver  are 
not  available,  something  will  be  substituted  as  a  temporary 
expedient.  Horace  White  enumerates  the  following  as  having 
been  used  as  money  within  liistorical  times:  cattle,  cacao 
beans,  salt,  silk,  furs,  tobacco,  dried  fish,  wheat,  rice,  olive-oil, 
coconut  oil,  cotton  cloth,  cowry  shells,  iron,  copper,  platinum, 
nickel,  silver,  and  gold ;  indeed,  he  says,  "it  would  be  difficult 
to  say  what  has  not  been  used  as  money  at  some  time  or 
place."  The  "  wampum  "  and  tobacco  currencies  of  our  early 
colonial  times  are  familar  to  every  one.  On  the  Pacific  Coast, 
cattle  were  commonly  used  as  money  up  to  recent  times.  The 
abstract  of  my  farm  in  California  shows  two  cases  in  which 
the  property  was  sold  for  "cattle"  with  no  money  value 
attached  to  them,  and  to  be  delivered  at  a  future  time. 

It  is  even  insisted  by  some  that  notes  upon  which  are 
printed  by  national  authority  the  words,  "  This  is  a  dollar,"  or 
some  equivalent  expression,  are  as  good  as  any  money  for  all 
necessary  purposes,  even  though  issued  with  no  promise  or 
intent  to  redeem  in  anything.  There  is  just  enough  of  truth 
in  this  contention  to  make  it  a  very  dangerous  error  among 
those  who  have  not  thought  carefully  about  money,  and  who 
are  anxious  to  be  able  to  get  money  cheaply.  There  is  no 
doubt  that  the  necessity  of  money  is  so  great  that,  in  the 
absence  of  anything  better,  such  money  as  this  would  perform 
all  the  necessary  functions  of  money  within  the  territory  of 


346  THE    QUESTIONS    OF    THE    DAY. 

the  nation  authorizing  it,  but  provided  only  that  no  more  of  it 
were  issued  than  would  equal  in  nominal  value  the  gold  and 
silver  necessary  to  conduct  the  business,  if  that  could  be  had. 
Such  money  is  called  "fiat  money,"  "fiat"  being  a  Latin  word 
meaning,  "let  it  be  done,"  that  is,  in  this  case,  "let  this  be 
money."  The  people  of  a  new  country,  like  our  first  colonists, 
have  no  means  of  getting  gold  and  silver — international 
money — except  by  the  exportation  of  goods.  But  exchanges 
among  themselves  are  all  the  time  going  on,  domestic 
exchanges,  in  fact,  at  all  times  greatly  exceeding  international 
exchanges  in  volume,  and  for  these  money  is  needed.  In 
such  cases  there  is  no  doubt  that,  as  a  temporary  expedient, 
fiat  money  carefully  restricted  in  volume  would  be  much 
better  money  than  cattle,  or  tobacco,  or  rice,  whose  production 
would  increase,  and  ought  to  increase,  and  so  cease  to  be  a 
good  medium  of  exchange.  When  such  money  had  served  its 
turn  it  would  be  received  in  payment  of  taxes  and  so  return 
to  the  authority  which  originally  received  goods  for  it. 
Practically,  however,  there  are  difficulties  in  the  way  of  even 
this  use  of  fiat  money.  The  infirmity  of  human  nature  is 
such  that  no  government  would  be  able  to  restrict  its  issues  of 
fiat  money  to  the  amount  required  to  pay  for  what  itself 
required,  which  would  be  very  small,  because,  when  issued,  it 
would  immediately  begin  to  return  in  taxes,  so  that  the 
government  would  soon  receive  money  enough  for  its  uses  in 
the  ordinary  way.  This  would  not  satisfy  the  people,  who 
would  insist  upon  the  government  printing  the  money  and 
lending  it  to  them.  This  would  very  quickly  introduce  into 
circulation  a  much  greater  amount  of  money  tlian  would 
naturally  be  present  of  gold  and  silver  or  its  representatives, 
in  the  course  of  freely  moving  national  and  international 
exchanges,  when  it  would  immediately  depreciate,  and  cease 
to  be  a  good  medium  of  exchange.  And  still  it  is  true  that 
pure  fiat  money,  with  issues  cai'efully  restricted  to  displace 
only  its  face  value  of  metallic  or  representative  money,  would 
probably  make  an  entirely  satisfactory  medium  of  domestic 
exchanges.      I  sny  "probably,"  because   the   exporimont  has 


THE  FARMER  AND  THE  CURRENCY.  u4/ 

never  been  made,  and  we,  therefore,  do  not  know  exactly  what 
would  happen.* 

An  issue  of  fiat  money  thus  carefully  restricted  would  save 
to  the  country  making  use  of  it  the  interest  upon  the  value  of 
the  metals  displaced,  and  the  loss  of  their  abrasion,  less  the 
cost  of  preparing  and  renewing  the  paper  currency.  It  would 
not,  however,  accomplish  what  its  only  advocates  desire:  it 
would  not  make  money  "cheap"  and  easy  to  get.  If  its 
volume  were  restricted  to  that  of  the  other  money  which 
would  circulate,  it  would  be  as  hard  to  get  as  other  money;  if 
it  were  increased  above  that  point  it  would  depreciate  and 
cease  to  be  good  money. 

When  paper  money  is  issued  in  excess  of  the  gold  and 
.silver  which  would  circulate  in  its  absence,  tlie  currency  is 
said  to  be  "inflated."  No  nation,  I  think,  wdiich  has  ever 
resorted  to  the  use  of  irredeemable  |)aper  money,  has  failed  to 
issue  it  in  excess— usually  very  much  in  excess — of  the  gold 
and  silver  previously  in  use.  Such  money  when  issued  by 
banks  is  issued  to  earn  interest,  and  when  issued  by  nations, 
is  issued  to  save  interest.f  Experience  shows  that  so  long  as 
it  can  be  made  to  have  the  appearance  or  the  prospect  of 
accomplishing  these  objects,  the  issues  will  be  increased.  If 
issued,  as  the  advocates  of  "fiat  money  "  desire,  as  loans  to  the 
people,  there  would  hardly  be  any  restraint  on  the  volume. 
As  the  issues  increased  it  would  depreciate.  If  redeemable, 
the  people  would  in  tlie  end  be  taxed  to  make  good  the 
depreciation.  If  pure  "hat"  money,  the  loss  would  fall  upon 
its  holders  from  time  to  time. 

But  all  popular  demand  for  the  issue  of  fiat  or  irredeemable 
paper  money  is  accompanied    with    the   demand    that  it   be 


*Many  economists  of  repute  are  of  the  opinion  that  sometime  in  the  future 
all  accounts  will  be  kept  in  what  they  call  "ideal  money'' — that  is,  money 
which  has  no  actual  existence.  There  are  no  theoretical  difficulties  in  the  way 
of  this,  and  it  offers  ver}-  tangible  advantages,  but  it  does  not  contemplate  the 
disuse  of  actual  money,  and  is  not  yet  a  "  question  of  the  day." 

fOf  course  government  paper  money  has  often  been  issued  because  other 
money  could  not  be  had,  even  by  borrowing. 


348  THE    QUESTIONS    OF    THE    DAY. 

made  a  "legal  tender."  A  legal  tender  is  money  which  the 
law  compels  creditors  to  receive  in  payment  for  debt.  It  will 
bo  more  convenient  to  discuss  tliis  a  little  later.  It  is  sufficient 
to  say  here — where  we  are  discussing  money  only  as  an 
instrument  of  exchange,  that  what  tlie  advocates  of  liat  money 
desire  is  the  opportunity  to  pay  debt  with  money  which  is 
easier  to  get  than  gold  or  silver.  I  am  not  discussing  now 
whether  this  would  or  would  not  be  just,  but  merely  defining 
the  real  issue.  But  whether  just  or  not  the  experience  of 
mankind  is  that  attempts  to  raise  prices  by  the  excessive  issue 
of  representative  paper  money  have  proved  very  disastrous, 
and  that  there  can  be  no  doubt  that  the  issue  of  pure  fiat 
money  would  be  even  more  so.  The  first  to  suff'er  are  the 
rich.  In  the  end  the  rich  get  their  money  back  from  tlie 
poor.*  Those  who  always  suffer  most  and  longest  are  the 
farmers.  The  injustice  connected  with  the  use  of  money  I 
shall  come  to  soon.  The  use  of  irredeemable  or  fiat  money  is 
not  the  way  to  remedy  the  injustice,  for  the  reason  that  a 
popular  government  is  never  able  to  refrain  from  abusing  tlie 
privilege  of  issuing  such  money,  and  the  people,  especially  the 
farmers,  have  not  the  strength  and  slirewdness  to  prevent  the 
consequences  from  in  the  end  falling  mostly  upon  themselves. 
There  are  one  or  two  popular  fallacies  that  may  as  well  be 
disposed  of  here.  Many  suppose  that  it  is  a  great  misfortune 
to  have  money  "go  out  of  the  country,"  and  even  advocate  the 
use  of  irredeemable  or  other  purely  "  national"  currency 
because  it  "  can  not  be  exported."  As  a  matter  of  fact,  no 
money  ever  does  go  out  of  the  country  except  to  buy  some- 
thing which  we  desire  more  than  money,  or  to  pay  debt;  in 
the  former  case  it  would  be  a  misfortune  not  to  liave  the 
money  go  out,  and  in  the  last  case  it  is  just  that  it  should  go. 


*An  instance  in  point  is  the  greenback  and  bond  issues  of  the  Civil  War. 
In  Ohio,  where  I  then  lived,  one  who  in  1860  borrowed  $1,000  could  bu}'  with 
it  1,000  bushels  of  wheat.  Four  years  later  he  could  have  paid  the  debt  with 
500  bushels  of  wheat.  The  creditor  lost  half  tiis  loan.  He  could,  however, 
and  many  did,  invest  the  money  in  U.  S.  bonds  at  fifty  cents  on  the  dollar  in 
gold,  and  the  farmer  later  helped  pay  it  at  face  value  in  gold.  The  farmer  lost 
by  the  transaction. 


THE  FARMER  AND  THE  CURRENCY.  349 

No  money  is  "  non-exportable "  except  for  the  reason  that 
nobody  outside  the  country  will  take  it.  It  is  never  desirable 
to  have  money  that  other  people  do  not  want  and  will  not 
have. 

Another  fallacy  is  that  the  po[)ulation  of  a  country  affords 
any  means  of  determining  the  amount  of  money  required  to 
"  transact  its  business."  There  is  a  great  deal  of  futile  com- 
parison of  the  "per  capita  circulation  "  of  one  country  with 
that  of  another.  Such  comparisons  have  no  value  in  the 
discussion  of  any  question  of  much  interest  to  the  people. 
When  a  statesman  observes  that  any  country  has  a  very  large 
per  capita  circulation  he  knows  that  either  business  is  very 
lively  there  or  that  there  is  a  large  irredeemable  circulation. 
Without  further  inquiry  he  can  not  tell  which.  As  an  item 
of  popular  information  it  has  much  less  value  than  the 
amount  of  annual  rainfall. 

Money  is  used  for  effecting  small  exchanges  and  paying 
balances.  In  the  majority  of  exchanges  which  enter  into  the 
record  of  the  business  transactions  of  the  country  it  is  not 
used  at  all.  Payments  are  made  by  the  balancing  of  credits 
based  on  the  ownership  of  commodities,  by  means  of  bank 
checks.  Some  economists  have  estimated  the  actual  money 
used  in  effecting  exchanges  as  low  as  three  per  cent  of  the 
total  volume;  a  more  common  estimate  is  five  percent.  I  am 
certain  that  this  is  far  too  low,  as  the  aggregate  of  small  trans- 
actions in  which  money  actually  passes  is  enormous,  but  the 
estimate  may  be  quite  correct  with  regard  to  those  transac- 
tions which  we  think  of  when  we  use  the  term  "commerce." 
As  what  we  call  "  civilization"  advances,  the  ratio  of  money  to 
the  business  transacted  grows  smaller.  It  will  be  within  the 
know^ledge  of  all  my  farming  readers  that  the  number  of  those 
who  have  bank  accounts  increases  year  by  year.  Every  man 
who  opens  an  account  in  a  bank  by  so  much  diminishes  the 
demand  for  actual  money. 

But  subject  to  this  modification,  that  a  scattered  rural 
community  needs  more  money  to  transact  a  given  amount  of 
business  than  a  city  community  where  money  circulates  more 
rapidly,  and   more   use   is  made  of  banks,  that  community 


350  THE    QUESTIONS    OF    THE    DAY. 

needs  and  will  have  the  most  money  ^jer  capita  where  most 
"business"  is  done.  There  are.seldom  any  means  of  knowing 
the  amount  of  money  actually  in  a  community  or  a  nation  at 
a  given  time,  or  how  long  it  will  stay  there,*  and  absolutely 
no  means  of  knowing  in  advance  how  much  is  required.  At 
any  rate,  whatever  there  is  is  enough  so  far  as  the  transaction 
of  the  business  is  concerned,  or  the  use  of  money  merely  as 
a  medium  of  exchange.  Least  of  all  is  any  "per  capita" 
estimate,  such  as  we  often  see,  of  any  value  whatever.  It 
simply  tends  to  a  confusion  of  thought.  I  have  said  that 
whatever  money  there  is,  within  reason,  is  enough,  so  far  as 
getting  all  necessary  enclianging  done,  because  the  absence  of 
money  to  effect  an  exchange,  proves  that  it  is  not  necessary  to 
be  made.  No  one  wants  the  commodities  that  are  for  sale,  or 
they  can  be  more  cheaply  bought  elsewhere.  If,  however, 
money,  or  credit  in  a  form  to  serve  the  purpose  of  money,  is 
scarce,  as  it  will  be  when  there  is  fear  or  uncertainty  as  to 
financial  conditions  in  the  near  future,  while  exchanges  will 
not  usually  stop,  prices  will  be  low,  while  if  money  and  credit 
are  abundant  prices  will  be  higher. 

This  brings  me  to  the  second  branch  of  my  subject — money 
as  a  measure  of  value.  It  is  only  in  regard  to  this  function 
of  money  that  there  is  ever  any  serious  popular  controversy. 
There  are  a  great  number  of  definitions  of  money,  and  I  do 
not  intend  to  add  to  them.  The  definition  which  is  most  com- 
monly employed  in  popular  discussion  is  that  it  is  "a  medium 
of  exchange  and  a  measure  of  value."  t 

The  second  part  of  this  definition,  which  I  take  because  it 


*A11  my  readers  are  familiar  with  the  fact  that  in  the  autumn  when  most 
crops  are  for  sale,  money  is  brought  into  the  country  "  to  move  crops."  The 
farmers  are  paid  cash.  This  they  distribute  to  their  creditors,  and  in  a  week  it 
is  all  back  in  the  banks  ready  to  pay  for  more  crops.  This  is  nearly  all  borrowed 
money.  When  all  the  crops  are  })ou!j;ht  the  money  goes  elsewhere  to  be  used 
in  other  ways. 

t  Socialists  insist  that  the  only  proper  measure  of  value  is  the  labor  units 
oinployed  in  production,  excluding  rent,  interest,  and  profits  whose  justice  they 
do  not  acknowledge.  .Single  taxers  also  consider  labor  the  ultimate  measure  of 
valvjf,  although  they  do  not  exclude  interest  and  profits. 


TIIK    I'AKMKR    AND    THE    CURRENCY.  351 

is  most  in  use  in  common  speech,  is  not  strictly  correct,  nor  is 
the  common  comparison  of  money  with  the  yardstick  and 
the  bushel  correct  in  all  cases.  To  measure  cloth  the  measure 
must  have  length,  as  a  yardstick;  and  to  measure  bulk  the 
measure  nmst  have  bulk,  as  the  bushel.  So  to  measure  value, 
the  measure  must  have  value.  Now  value  as  ordinarily  con- 
ceived means  the  results  of  labor  applied  to  the  production  of 
some  object  of  desire,  as  gold  or  silver.  Neither  metal  can  be 
obtained  without  substantial  labor,  and  both  are  objects  of 
desire,  irrespective  of  their  use  as  money.  Wampum,  how- 
ever, or  fiat  money,  is  not  the  result  of  much  labor,  nor  does 
any  one  desire  them  except  as  money.  They  have  no  value, 
and  hence  can  not  well  be  said  to  measure  value.  I  say  they 
have  no  value  to  make  tiie  point  clear,  and  yet  that  is  not 
quite  true.  So  long  as  society  acce})ts  them  as  money,  they 
have  a  value  for  that  purpose,  and  to  tlie  extent  that  they  have 
such  value  they  can  measure  value.  The  trouble  is  that, 
for  reasons  already  given,  society  is  constantly  changing  its 
opinion  in  regard  to  them,  usually  for  the  worse,  and  with 
every  fluctuation  of  opinion  there  is  a  change  in  the  capacity 
of  the  measure,  which  is  distinctly  what  we  do  not  desire  in 
any  measure.  Such  money  may  be  likened  to  a  leaky  gallon 
measure;  it  will  give  us  a  rough  notion  of  the  amount  of 
liquid,  provided  we  are  very  deft  and  move  quickly  enough ; 
if  we  let  the  milk  stand  a  little  in  the  measure,  there  will  be 
less  of  it;  if  we  accept  shaky  money  in  payment  and  keep  it 
a  few  days,  we  perhaps  can  not  again  buy  with  it  that  which 
we  sold  for  it.  We  none  of  us  desire  any  such  measure  of 
value  as  that. 

If  now  the  law  steps  in  and  prescribes  that  this  wampum 
or  fiat  or  irredeemable  money  shall  be  legal  tender — that  is, 
that  creditors  must  take  it  in  payment  for  debt — a  value  is 
certainly  created  which  did  not  before  exist.  The  money  at 
once  becomes  an  object  of  desire  to  those  who  have  debts  to 
pay,  especially  so  long  as  it  can  be  obtained  more  cheaply  than 
anything  else  that  will  pay  debt.  So  long  as  it  has  value  for 
paying  debts  it  will  be  received,  at  some  rate,  by  those  who  have 
no  debts  to  pay,  but  know  that  they  can  pass  it  on  to  those 


352  THE    QUESTIONS    OF    THE    DAY. 

who  have  that  use  for  it.  If  we  could  conceive  that  the  time 
would  come  when  there  were  no  debts  outstanding,  tlie  fiat 
money  might  lose  all  value,  since  no  law  can  compel  any  one 
to  part  with  property  in  Ijand  except  in  excliange  for  what  he 
desires.  In  former  ages  this  has  sometimes  been  tried  and  the 
severest  penalties  imposed  for  refusal  to  accept  whatever  the 
law  called  money  in  payment  for  goods.  It  has  never  suc- 
ceeded, except  as  for  a  sliort  time  the  terror  of  the  law  coerced 
some  individuals.  In  modern  times  no  such  attempt  would 
be  made,  and  if  it  were  would  simply  result  in  a  return  to 
barter. 

As,  under  any  conceivable  modern  legislation  or  condition, 
there  will  always  be  debts  to  pay,  it  is  the  belief  of  many 
excellent  persons  that  the  demand  for  any  legal  tender  money 
for  debt-paying  purposes  will  always  be  sufficient  to  keep  it  at 
its  full  face  value  for  other  purposes.  As  a  matter  of  fact,  it 
will  not,  if  issued  in  excess,  and  for  this  reason  that,  vast  as 
the  volume  of  pending  transactions  may  be  in  any  nation, 
they  are  but  a  trifle  in  comparison  with  the  aggregate  volume 
of  all  future  transactions,  and  when  men  part  with  property, 
and  have  no  debts  to  pay,  they  will  value  the  money  they 
receive  for  it  solely  with  regard  to  the  use  they  can  make  of  it 
in  the  future;  they  will  therefore  accept  money  having  no 
ijitrinsic  value  of  its  own,  solely  with  reference  to  what  they 
conceive  its  value  may  be  in  the  future;  and  if  they  part 
with  property  to  be  paid  for  at  some  future  time,  knowing 
that  tliey  may  be  paid  in  money  which  they  do  not  like,  they 
will  set  their  price  sufficiently  high  to  make  themselves  good.* 
It  is  in  this  way,  also,  that  we  most  readily  see  the  operation 
of  increased  volumes  of  money  in  raising  prices,  a  raise  in  the 
level  of  general  prices  being  precisely  equivalent  in  meaning 
to  a  depreciation  of  money,  although  from  force  of  habit  we 
seldom  think  of  the  occurrence  except  as  an  advance  of  price. 


*  The  alternative,  when  the  law  permits  it,  is  to  contract  to  be  paid  in  some 
money  satisfactory  to  the  creditor.  This  is  what  is  now  taking  place  in  the 
United  States  with  regard  to  loans,  and  other  long  credits,  which  are  generally 
made  payable  in  U.  S.  gold  coin. 


THE  FARMER  AND  THE  CURRENCY.  353 

which  is  usuall}^  for  the  producers,  a  time  of  prosperity, 
because  costs  seldom  advance  as  rapidly  as  prices,*  and 
because  confidence  in  the  future  induces  free  purchases. 

From  all  the  foregoing,  upon  which  I  believe  all  econo- 
mists are  substantially  agreed,  it  must  be  evident  that  the 
only  money  which  is  satisfactory  to  everybody,  even  for  strictly 
national  use,  is  coined  gold  and  silver,  or  paper  money  known 
to  be  actually  and  conveniently  convertible  into  coin,  the 
aetual  coin  or  certified  bullion  being  the  only  reliable  inter- 
national money,  at  least  between  distinct  nations. 

This  is  because  these  metals  represent  actual  labor  in 
substantial  quantities,  applied  to  the  productipn  of  materials 
which  are  objects  of  desire  irrespective  of  their  use  of  money, 
and  which  are  practically  indestructible.  They  have  intrinsic 
value,  which  means  that  they  are  desired  for  themselves,  and 
not  solely  for  qualities  which  have  been  imparted  to  them. 

A  satisfactory  national  money,  not  redeemable  in  the  pre- 
cious metals,  is  theoretically  possible,  but  not  practically  so,  by 
reason  of  the  inferiority  of  human  judgment  and  of  human 
nature,  which  renders  it  impossible  to  prevent  over  issues. 

The  fact  that  a  merely  national  currency  is  non-exportable 
is  not  only  of  no  value  to  the  nation  which  uses  it,  but  is  a 
slight  hindrance,  as  the  nation  having  the  non-exportable 
currency  must  pay  the  cost  of  procuring  the  precious  metals 
to  pay  foreign  obligations,  if,  as  will  usually  be  the  case,  it 
is  a  debtor  nation.  This  is  not  a  very  serious  matter,  and 
apparently  does  not  seriously  interfere  with  trade.  If  there 
were  any  special  advantage  in  having  a  national  currency — as 
silver — for  domestic  purposes,  the  matter  of  foreign  exchange 
should  not  stand  in  the  way,  since  in  all  countries  the  volume 
of  domestic  transactions  is  enormously  greater  than  that  of  its 
foreign  transactions,  and  therefore  entitled  to  first  consider- 
ation in  mere  matters  of  convenience. 

It  is  also  true  that  as  human  society  is  now  constituted,  all 
the  money,  or  what  serves  the  purpose  of  money,  in  the  world, 
must  be  considered  as  one  stock,  which  flows  freelv  where  it  is 


*  Neither  can  they  be  reduced  as  rapidly,  when  prices  are  falling 

23 


354  THE    (iUESTIONS    OF    THE    DAY. 

most  demanded — that  is,  where  profitable  use  can  be  made  of 
it — except  as  hindered  by  international  barriers  in  cases  where 
any  nation  uses  non-exportable  money. 

In  such  cases  the  non -exportable  money  displaces,  for  all 
domestic  uses,  the  precious  metals,  which  go  elsewhere  to  per- 
form their  functions  in  the  money  or  the  arts.  This  is  the 
well-known  Gresham's  law,  which  is  merely  that  any  person 
having  two  kinds  of  money  will  pay  out  the  less  valuable  to 
him,  and  keep  the  other,  which  is  thus  withdrawn  from  circu- 
lation. In  due  time  this  better  money  finds  its  way  to  the 
banks,  usually  at  a  premium,  and  thence  to  some  other 
country  where  there  may  be  use  for  it. 

The  non-exportable  money,  whether  entirely  inconvertible 
or  not,  adds  to  the  world's  stock  of  money,  not  its  own  volume, 
but  the  amount  of  the  precious  metals  which  it  displaces.* 
Its  extensive  use,  therefore,  must  tend  to  de|)ress  the  general 
level  of  the  world's  prices,  even  although  it  has  the  effect  of 
raising  prices  in  the  country  which  uses  it. 

In  a  large  sense  it  is  true  that  tlie  more  money  and  credit 
there  is  in  the  world  at  any  time,  the  higher  the  level  of 
prices.  The  volume  of  money  does  not  vary  much,  but  the 
volume  of  credit  fluctuates  greatly.f     Credit  is  confidence  in 


*If  $1,000,000,000  is  assumed  as  the  amount  of  metallic  money  which 
would  circulate  in  a  nation  in  which  all  money  was  equal  to  coin,  and  subse- 
quently irredeemable  money  to  the  amount  of  $2,000,000,000  was  issued,  tlie 
irredeemable  money  would  simply  take  the  place  of  the  $1,000,000,000  of  coin, 
which  would  be  set  free  to  do  its  work  elsewhere  in  the  world.  In  this  case 
there  is  no  question  that  the  world's  stock  of  money  is  actually  increased  so 
long  as  the  irredeemable  money  does  its  intended  work.  But  it  does  not  add 
$2,000,000,000;  for  the  excess  of  issue  is  not  money  but  inflation.  It  adds  to 
apparent  value  in  the  country  using  it,  but  not  to  real  valuta 

f  It  must  not  be  understood  by  this  that  we  can  make  prices  bob  up  and 
down  like  corks  in  rough  water,  by  constantly  tinkering  with  the  currency. 
The  operation  of  money  on  prices  is  very  slow,  which  we  are  apt  to  forget  in 
our  glib  discussions  of  the  subject.  We  can  state  in  a  sentence  a  result  which 
is  the  work  of  years.  Effects  are  first  felt  in  the  money  centers,  where  those 
whose  business  it  is  to  study  these  movements,  foresee  what  is  coming  and  adapt 
their  business  to  it.  Gradually  the  effects — possibly  not  for  a  year  or  two — 
begin  to  be  felt  in  the  rural  districts.     Before  this,  however,  they  have  been 


THE    FARMKK    AND    THE    CURRENCY.  355 

the  future.  When  this  fails  the  stock  of  money  is  also  locked 
u[),  and  we  say  that  money  is  scarce,  when  there  is  nearly  as 
much  money  as  ever.  Money  alone,  however,  will  go  but  a 
very  little  way  towards  transacting  the  business  of  the  world. 
When  we  say  that  money  is  scarce,  what  we  really  mean  is 
that  it  is  generally  thought  that  a  great  many  people  are  not 
going  to  be  able  to  pay  their  debts,  and  that  consequently 
immense  quantities  of  property  are  going  to  come  on  the 
market,  for  much  of  which,  at  least  for  a  time,  there  will  be 
no  profitable  nse.  Those  who  owe  money,  therefore,  hoard  it, 
in  order  to  pay  their  own  debts  in  case  they  fail  of  collections, 
or  for  fear  they  will  lose  it  if  lent,  and  those  who  desire  to 
borrow  are  unable  to  get  either  money  or  credit.  Of  course, 
under  such  circumstances,  money  is  as  plenty  as  before,  per- 
haps more  plenty,  since  all  who  have  the  power  will  call  it  in 
from  other  countries,  but  it  can  not  be  borrowed.  As  the 
greater  part  of  the  commercial  business  of  the  world  is  done 
on  borrowed  money  or  credit,  business  tends  to  stop  and  prices 
to  fall.  When  the  alarm  is  acute  and  excessive,  there  follows 
what  we  call  a  panic,  when  everybody  tries  to  collect  every 
dollar  that  is  owing  to  him  and  hoard  it. 

But  while  credit,  more  than  money,  fixes  the  prices  of 
commodities,  the  volume  of  money  is  so  large  that  in  the 
long  run  as  money  increases  prices  tend  to  decrease.  Money 
never  decreases,  except  by  the  withdrawal  of  inconvertible 
money  from  circulation,  or  by  the  loss  of  purchasing  power  of 
some  part  of  it.  When  this  occurs  there  is  a  depression  of 
prices,  subsequently,  if  the  loss  is  local,  by  withdrawal  of 
irredeemable  money,  made  good  by  the  inflow  of  other  money. 
If  the  depression  is  severe,  and  accompanied  by  a  loss  of  credit, 
this  may  take  a  long  time.  If  by  loss  of  purchasing  power  of 
international  money,  the  effect  is  world-wide. 

I  have  hitlierto  treated  gold  and  silver  as  of  equal  impor- 


discounted  by  more  acute  and  better-infonned  men,  and  the  fanner  pays  hiii;b 
prices  for  merchandise  sometimes  before  he  gets  high  prices  for  produce,  and 
continues  to  pay  high  prices  after  produce  begins  to  fall.  None  suffer  from  an 
unstable  currency  so  severely  as  the  farmer. 


356  THE    (QUESTIONS    OF    THE    DAY, 

tance  as  money  metals.  Up  to  about  1870  this  was  true.  Since 
that  time  a  great  alteration  has  taken  place  in  their  relative 
values,  which  has  resulted  in  a  great  political  controversy. 
The  money  "question  of  the  day"  is  the  question  of  tlie  use 
to  be  made  of  silver  as  a  money  metal.  Upon  this  question  I 
intend  to  give  no  opinion  of  my  own,  but  to  present  the  argu- 
ment for  each  side  in  a  form  acceptable  to  its  most  earnest 
advocates,  and  leave  the  reader  to  decide  for  himself,  prefacing 
this  with  a  statement  of  facts  conceded  by  all  well-informed 
persons  on  both  sides  of  the  question. 

Silver  and  gold  have  been  used  as  money  by  all  civilized 
nations  from  time  immemorial.  They  have  never  been  held 
at  the  same  value  in  exchange,  pound  for  pound.  Since  the 
dawn  of  history  a  pound  of  gold  would  always  buy  more 
commodities  than  a  pound  of  silver.  This  difference  has 
tended  to  increase  slowly,  with  occasional  fluctuations  the 
other  way,  since  such  matters  have  been  carefully  noted.  At 
the  opening  of  trade  with  Japan  a  pound  of  gold  was  valued  in 
that  country  at  four  pounds  of  silver.  Of  course  it  very  soon 
rose  there  to  its  value  in  silver  elsewhere,  doubtless  making 
some  fortunes  quickly  for  shrewd  traders.  In  England,  in 
1262,  there  are  records  of  exchanges  at  the  rate  of  nine  and 
two-fifths  pounds  of  silver  for  one  of  gold;  in  1485,  the  ratio 
of  silver  to  gold  was  declared  to  be  thirteen  and  three-fourths 
to  one;  this  was  in  England.  About  the  same  time  the  ratio 
in  Spain  was  about  ten  and  one-half  to  one.  Gradually  as 
commercial  intercourse  increased,  the  ratios  in  different  coun- 
tries tended  to  come  together,  although  not  very  closely ;  in 
1724  the  ratio  at  the  French  mint  was  fourteen  and  one-half 
to  one,  and  at  the  English  mint  fifteen  and  one-fifth  to  one. 
On  the  continent  of  Europe,  in  the  latter  part  of  the  eighteenth 
century,  the  more  common  ratio  was  fifteen  and  one-half  to 
one,  at  which  ratio  it  is  still  maintained  so  far  as  coined.* 
When  the  United  States  began  coinage  the  ratio  was  fixed  at 
fifteen  to  one;  but  as  a  pound  of  gold  would  buy,  in  France, 
half  a  pound  more  of  silver  than  it  would  buy  here,  all  our 


*  Silver,  except  subsidiary  coins,  is  not  coined  in  Europe. 


TIIK    FAiniKi;    AND    Till-:    CURKKXCY.  of)? 

gold  went  out  of  the  country,  and  we  were  on  a  silver  basis, 
although  nominally  the  basis  was  bimetallic. 

The  fact  was  that  silver  and  gold  refused  to  remain  per- 
manently at  any  ratio  in  any  country.  The  law  had  no  effect 
on  the  "ratio,  excej)t  when  debts  were  to  bo  paid.  The  com- 
mercial importance  of  England,  in  the  meantime,  so  increased 
that  there  was  frequent  occasion  for  the  payment  of  very 
large  sums,  upon  which  the  saving  of  one-fourth  or  one-half 
of  one  per  cent  was  an  object.  The  half  of  one  per  cent  on 
$100,000  is  $500.  Of  course  all  debts  w^ere  paid  in  the  cheap- 
est metal  for  the  time  being,  which  led  to  constant  friction 
in  the  mercantile  classes;  and  partly  to  get  rid  of  this  incon- 
venience and  bickering,  England,  in  1810,  after  some  years  of 
experiment,  made  gold  the  standard  and  the  only  legal  tender 
for  debts  above  $10.  That  law  has  never  been  changed.  It 
was  enacted  for  the  benefit  of  the  trading  and  manufacturing 
classes,  has  always  been  acceptable  to  them,  and  did  not 
interfere  with  the  use  of  silver  in  the  small  transactions  of  the 
masses.  No  economist  has  noted  that  the  use  of  silver  seriously 
decreased  in  consequence  of  the  act,  or  that  its  price,  as  com- 
pared with  gold,  fell.  In  fact,  it  did  not,  the  ratio  of  silver  to 
gold  remaining  just  as  it  had  been,  gently  fluctuating  about 
fifteen  and  a  half  to  one  in  all  commercial  countries. 

In  1834  the  United  States,  partly  in  the  hope  of  increasing 
the  "home  market"  for  gold,  which  was  then  believed  to  exist 
in  large  quantities  in  the  southern  states,  changed  the  ratio 
from  fifteen  to  one  to  sixteen  to  one.  Our  silver  was  now 
overvalued,  wuth  res[)ect  to  the  European  market,  and  in  two 
or  three  years  all  our  silver  had  disappeared,  even  to  the  dimes 
and  half  dimes,  and  its  place  was  taken  by  gold  which  came 
back  from  Europe.  For  small  change  we  were  reduced  to 
Mexican  and  other  foreign  silver  which  had  become  too  much 
worn  to  circulate  in  its  own  country,  and  was  bought  uj) 
cheaply  by  speculators,  shipped  to  this  country,  and  put  into 
circulation  at  its  face  value.  This  was  the  silver  used  in  all 
rural  districts  up  to  the  time  of  the  Civil  War.  All  elderly  per- 
sons w^ill  remember  the  squabbles  as  to  whether  the  "pillars" 
could  be  seen  on  the  pieces.     If  they  could  be  seen  the  piece 


358  THE    QUKSTIONS    OF    THE    DAY. 

was  a  quarter  of  a  dollar;  if  not,  it  was  ten  cents.  This  dis- 
appearance of  small  coin  is  not  likely  to  occur  again,  as  all 
commercial  nations  now  introduce  alloy  into  small  coins,  so 
that  their  metal  value  is  much  less  than  tlieir  face  monetary 
value.  This  renders  it  unprofitable  to  melt  or  export  them, 
and  they  remain  in  tlie  country  for  the  use  of  the  people.  If 
they  were  issued  greatly  in  excess  of  requirements  for  small 
change,  they  would  depreciate  to  their  metal  value. 

During  tlie  Civil  War,  and  for  some  years  after,  we  had  an 
irredeemable  currency,  neither  silver  nor  gold  being  in  circula- 
tion except  on  the  Pacific  Coast,  where  a  strong  local  sentiment 
kept  them  in  use.  Even  our  small  change  was  paper.  This 
was  the  first  thing  to  be  remedied,  as  the  gradual  appreciation 
of  the  paper  brought  the  debased  subsidiary  coins  into  circu- 
lation, while  the  silver  dollar  aud  the  gold  coins  were  still  at 
a  premium. 

As  the  time  for  resumption  of  specie  payments  approached, 
it  became  necessary  to  revise  our  coinage  laws,  which  were 
antiquated  and  in  many  respects  inconvenient.  We  were 
coining  some  pieces,  as  the  three-cent  piece  and  the  twenty- 
cent  piece,  which  were  not  found  desirable.  At  that  time  we 
had  become  used  to  ])aper  money  of  small  denominations,  and 
there  seemed  to  be  no  desire  for  silver  dollars.  It  was  at  any 
rate  useless  to  coin  tliem,  as  they  were  worth  more  than  their 
face  value  in  gold,  and  consequently  would  not  circulate,  but 
go  to  the  melting  pot  as  fast  as  made,  thus  keeping  our  mints 
at  work  absolutely  for  nothing,  with  a  loss  to  the  country  of 
from  $20  to  $40  upon  each  $1,000  coined,  as  the  silver  bullion 
cost  the  nation  so  much  more  than  could  be  obtained  for  it  when 
coined.  This,  of  course,  government  would  not  permit,  and 
as  no  owner  of  bullion  would  offer  it  for  coinage,  no  silver 
dollars  had  been  coined  for  many  years.  In  1861,  when  the 
silver  dollar  was  worth  $1.03  in  gold,  the  director  of  the  mint 
recommended  either  a  change  in  the  ratio  or  the  abolisliment 
of  the  coin.  The  breaking  out  of  the  war,  however,  prevented 
action  at  that  time. 

In  1871,  however,  when,  after  some  years  of  investigation 
by  committees,  Congress  set  about  enacting  a  new  coinage  law, 


THE    FARMER    AN  I 


859 


a  bill  passed  the  Senate,  which  had  been  prepared  by  the 
Secretary  of  tiie  Treasury  and  tiie  director  of  the  mint,  which 
adopted  the  gold  dollar  as  the  monetary  unit,  and  discon- 
tinued the  silver  dollar*  which  was  then  worth  $1.02  in  gold. 
The  matter  attracted  no  public  attention,  for  it  was  not  thought 
of  as  having  popular  interest.  For  lack  of  time  the  bill  failed 
to  become  a  law  at  that  cession,  but  subsequently,  in  1873,  was 
duly  enacted.  It  w^as  freely  discussed  in  both  Houses,  but 
attracted  little  attention,  as  very  few  congressmen  or  editors 
knew  anything  about  the  subject.  It  was  a  matter  upon 
which  Congress  and  the  pul)lic  were  accustomed  to  rely 
upon  the  experts  of  the  Treasury  Department,  and  coinage 
committees. 

It  has  been  believed  by  a  great  many  people  that  these 
experts  w^ere  corrupt,  and  that  the  omission  of  the  silver 
dollar,  which  amounted  to  a  demonetization  of  silver,  was  the 
result  of  a  criminal  conspiracy,  intended  to  operate  to  the 
iin})roper  advantage  of  capitalists.  There  is  not  the  slightest 
evidence  that  such  was  the  case.  On  the  contrary,  in  the  light 
of  the  experience  of  the  world  up  to  that  time,  and  of  the 
condition  of  economic  science  ^t  that  time,  it  would  seem  that 
no  economist  or  statesman  could  have  had  any  reason  to  sup- 
})ose  that  any  serious  results,  affecting  values  on  a  large  scale 
would  follow\t  Of  course  if  we  had  known  then  what  we 
have  since  learned  it  would  have  been  different.  Most  of 
the  really  important  things  bearing  on  this  question  had  not 


*  Three  other  coins  were  discontinued  in  1873 — the  three-cent,  two-cent,  and 
silver  five-cent  piece. 

t  It  was  predicted  by  a  few,  notably  by  Mr.  Ernest  Scyd,  an  English  expert, 
and  a  strong  biraetalist,  who  foretold,  at  the  beginning  of  the  movement,  which 
he  strongly  opposed,  almost  precisely  what  has  happened.  By  a  curious 
inversion  of  facts,  vehich  is  really  comical,  this  most  pronounced  of  all  bimetal- 
ists  appears  in  the  popular  legend  of  the  "Crime  of  187-S  ''  as  the  head  devil 
in  corrupting  our  congressmen  to  demonetize  silver.  Very  few  economists  or 
statesmen — none  in  fact  who  were  in  a  position  to  act — were  impressed  with 
this  prophecy,  and  I  do  not  think  they  can  be  blamed.  Men  who  can  see  a 
generation  ahead  are  called  cranks,  and  have  very  little  influence  in  their  own 
generation. 


360  THE    QUESTIONS    OF    THE    DAY. 

then  happened.  Any  notion  that  there  were  then  living 
bankers  with  shrewdness  enough  to  foresee  what  has  happened 
as  the  result  of  the  demonetization  of  silver,  and  faith  enough 
to  act  on  their  belief,  is  a  popular  myth.  Those  who  employ 
such  a  statement  in  argument,  hurt  their  cause.  There  was 
no  "crime  of  1873."  There  may  have  been  a  misfortune. 
The  standard  was  changed  for  greater  certainty  and  con- 
venience in  dealing  with  large  sums  of  money,  with  no  reason 
to  su))pose  that  it  would  have  any  important  effect  on  small 
transactions.     But  it  did. 

At  the  time  when  we  were  revising  our  coinage  systems, 
other  nations,  partly  for  the  same  reasons  which  determined 
us,  and  partly  for  local  reasons,  were  doing  the  same  thing. 
Germany  first,  and  then  other  countries,  wholly  or  partially 
demonetized  silver.  The  result  has  been  a  full  in  silver  as 
compared  with  gold,  unprecedented  in  the  history  of  mankind. 
In  1870  fifteen  and  six-tenths  ounces  of  silver  would  buy  one 
ounce  of  gold.  Now  it  requires  thirty-four  and  seven-tenths 
ounces  of  silver  to  buy  an  ounce  of  gold.  This  did  not  happen 
all  at  once.  For  the  first  ten  years  the  depreciation  was 
gradual.  In  1883  eighteen  and  six-tenths  ounces  of  silver 
could  still  buy  an  ounce  of  gold,  an  increase  of  tire  ratio  by 
only  three  in  ten  years. 

The  importance  of  keeping  the  two  metals  at  a  uniform  ratio 
has  always  been  recognized,  although,  until  recent  years,  the 
object  was  merely  to  prevent  the  niinor  fluctuations,  which  were 
embarrassing  in  large  transactions,  no  one  apparently  fearing 
any  such  depreciation  as  would  actually  affect  prices  of  com- 
modities. With  this  object  in  view,  France,  Belgium,  Switzer- 
land, Italy,  and  Greece  formed,  about  18GG,  what  is  known  as 
the  "Latin  Union,"  which  was  an  agreement  between  the  coun- 
tries that  their  coinage  of  gold  and  silver  should  be  at  the  ratio 
of  fifteen  and  one-half  to  one,  both  being  legal  tender.  Within 
a  few  years  after  1873,  public  attention  in  this  country  began 
to  be  directed  to  the  effect  of  the  disuse  of  silver  upon  prices, 
largely,  at  that  time,  owing  to  the  exertions  of  our  mine  own- 
ers, who  by  the  disuse  of  silver  for  coinage  began  to  find 
increasing   difficulty  in    marketing    their  bullion.      The  arts 


THE  FARMER  AND  THE  CURRENCY.  361 

would  not  absorb  the  annual  output  of  bullion  at  prices  which 
had  hitlierto  been  paid.  For  the  purpose  of  sustaining  silver, 
which  was  then  at  a  ratio  of  seventeen  and  nine-tenths  to  one, 
Congress,  in  1878,  directed  the  coinage  of  silver  dollars  to  be 
resumed,  and  made  them  legal  tender,  concurrently  with  gold, 
in  unlimited  amounts,  at  their  face  value,  which  was  at  the  ratio 
of  sixteen  to  one,*  at  the  same  time  pledging  the  faith  of  the 
United  States  that  all  money  issued  by  its  authority  should 
be  constantly  maintained  at  its  face  value  at  the  existing  ratio 
of  sixteen  to  one.  This,  in  effect,  pledged  the  United  States  to 
give  gold  dollars  for  silver  dollars  on  demand,  which  has 
always  been  done,  although  by  indirect  methods  involving 
more  trouble  than  a  direct  exchange  of  one  metal  for  the  other. 
The  latter,  however,  is  usually  done  at  all  sub-treasuries  when 
requested. 

As  it  was  evident  that  when  any  one  could,  with  an  ounce 
of  gold,  buy  seventeen  and  nine-tenths  ounces  of  silver,  have 
it  coined,  and  buy  back  the  ounce  of  gold  for  sixteen  ounces 
of  coined  silver,  every  one  would  be  eager  to  do  it,  and  that, 
therefore,  unless  silver  should  promptly  rise,  there  would  be 
a  great  loss  to  the  treasury,  individuals  were  not  allowed  to 
deposit  silver  for  coinage,  but  the  Secretary  of  the  Treasury  was 
directed  to  buy  the  bullion  and  coin  it  for  account  of  the  gov- 
ernment, which  in  this  way  made  the  profit  between  the  market 
value  of  silver  bullion  and  the  face  value  of  the  coin.  This 
profit  to  the  government  is  called  "seigniorage."  The  amount 
directed  to  be  coined  was  not  less  than  $2,000,000,  and  not 
more  than  $4,000,000  per  month.  It  was  believed  that  coin- 
age to  this  amount  would  sustain  the  price  of  silver.  In  the 
meantime  the  authorities  of  the  Latin  Union  had  become 
alarmed,t  and  in  1873  had  agreed  that  the  aggregate  annual 


"The  exact  ratio  is  15.98  to  1. 

t  When  the  Latin  Union  was  formed  it  established  "  free  coinage  ""  for  both 
gold  and  silver.  Any  one  could  deposit  either  metal  and  receive  coin  for  it  less 
a  trifling  mint  charge.  When  silver  began  to  fall,  the  market  ratio  had  only 
to  increase  to  15.75  to  induce  deposits  of  silver  for  coinage  in  France,  to  an 
amount  greater  than  the  capacity  of  the  mint  for  two  years.     In  one  year  the 


362  THE    QUESTIONS    OF    THE    DAY. 

silver  coinage  of  all  its  members  should  not  exceed  $24,000,000, 
and  that  it  should  not  be  legal  tender  for  sums  above  $10. 
Subsequently,  in  1876,  all  coinage  of  silver,  except  subsidiary 
coins,  was  discontinued  by  the  Latin  Union,  and  a  similar 
course  was  gradually  taken  by  all  other  European  countries 
except  Russia,  which  is  on  a  silver  basis,  and  subsequently  by 
British  India  and  Japan. 

As  silver  continued  to  fall  in  spite  of  purchases  by  the 
United  States,  the  Secretary  of  the  Treasury,  in  1890,  was 
directed  to  increase  his  purchases  to  4,500,000  ounces  per 
month,  of  which  2,000,000  ounces  were  to  be  coined,  the 
remainder  to  lie  in  the  treasury  as  bullion,  unless  called  for, 
as  coin,  by  the  demands  of  commerce.  Gold  and  silver 
were  at  that  time  at  a  ratio  of  nineteen  and  six-tenths  to 
one.  It  was  hoped  that  these  liberal  purchases  would  surely 
sustain  the  price  of  silver,  but  they  did  not,  and  in  1893  the 
purchasing  clause  of  the  act  was  repealed,  and  since  that  time 
no  silver  has  been  purchased  by  the  United  States,  and  little, 
if  any,  coined.  On  November  1, 1894,  the  United  States,  since 
1873,  had  coined  silver  dollars  of  the  face  value  of  $421,776,- 
408,  and  had  on  hand,  in  addition,  silver  bullion  to  the  amount 
of  138,809,081  fine  ounces.  The  total  cost,  in  gold,  of  the 
coin  and  bullion  had  been  $508,993,975.  It  was  worth,  at  that 
time,  $293,549,258*  in  gold,  and  as  this  is  written,  with  the 
ratio  of  silver  to  gold  thirty-four  and  seven-tenths  to  one,  is 
worth,  as  bullion,  $278,472,525— the  United  States  being 
pledged,  as  to  the  portion  which  is  coined,  to  maintain  it  at 
its  face  value  of  sixteen  to  one. 

It  became  evident  that  the  United  States  could  not  sustain 
the  price  of  silver  in  this  way,  and  tiiat  the  attempt  to  do  so 


deposits  of  silver  to  be  coined  rose  from  5,000,000  francs  to  054,000,000  francs. 
If  a  ditference  of  .25  could  cause  such  a  rush  to  dump  silver,  it  can  be  imagined 
what  would  happen  if  the  diflerence  were  greater.  As  the  Latin  Union,  like 
the  United  States,  guaranteed  the  ratio  of  16^  to  1  on  all  its  coinage,  it  was 
compelled  first  to  restrict  and  then  to  suspend  free  coinage  of  silver. 

*  At  average  prices  of  silver  for  1894.     Thosi;  figures  are  not  extended  to 
absolute;  correctness. 


THE  FARMER  AND  THE  CURRENCY.  obo 

was  seriously  impairing  its  credit  and  that  of  its  peo[)le.* 
The  United  States,  wliile  nominally  on  a  bimetallic  basiS; 
because  gold  and  silver  of  its  own  coinage  are  both  legal 
tender  in  unlimited  amounts,  is  really  upon  a  gold  basis, 
because  the  United  States  stands  pledged  to  redeem  the  silver 
in  gold.  We  receive  a  silver  dollar  at  the  same  value  as  a 
gold  dollar,  not  for  the  silver  there  is  in  it,  nor  wholly  because 
it  is  legal  tender,  but  because  of  the  promise  of  the  United 
States  to  see  that  we  get  gold  for  it.  If  we  should  lose  faith  in 
that  promise,  silver  dollars  would  depreciate.  Should  its  legal 
tender  function  also  be  withdrawn.  United  States  dollars  would 
be  worth  no  more  than  Mexican.  So  long  as  we  have  faiih  in 
the  promise  of  the  United  States,  the  withdrawal  of  its  legal 
tender  function  would  make  no  difference  in  its  value  in 
ordinary  transactions.  National  bank  notes  are  not  legal 
tender,  but  we  accept  them  without  question,  or  caring  any- 
thing about  the  banks  which  issue  them,  because  we  know 
that  the  United  States  will  redeem  them,  if  the  banks  fail. 

Upon  the  failure  to  sustain  silver  by  monthly  purchases, 
and  after  international  conferences  had  made  it  evident  that 
no  international  agreement  for  the  remonetization  of  silver 
could  be  reached,  the  advocates  of  silver  in  this  country  cut 
their  bridges  and  took  the  only  position  which  it  was  possible 
to  take  with  any  show  of  reason.  They  demand  that  we  open 
our  mints  to  the  free  coinage  of  silver,  by  whomsoever 
deposited,  at  the  ratio  of  sixteen  to  one,  and  that  the  silver  so 
coined   shall   be   legal  tender  in  unlimited   amounts,  for  all 


*The  expression  in  the  text  means  exactly  what  it  says.  The  business,  and  espe- 
cially the  creditor,  classes  did  not  believe  that  the  United  States  were  rich  enough 
to  make  good  the  difterence  between  the  market  and  our  legal  ratio  of  all  the 
silver  in  the.  world,  nor  did  they  believe  the  people  would  long  submit  to  be  taxed 
even  to  make  good  the  difference  on  the  amount  then  authorized  to  be  purchased. 
They  did  not  know  what  would  happen,  but  were  sure  things  could  not  go  on 
as  they  were.  Hence  they  began  to  press  for  gold  while  they  could  get  it,  and 
refused  to  lend  more  money  except  on  gold  contracts,  and  then  with  much 
caution,  or  to  undertake  any  new  enterprises.  We  could  not  get  trusted  to  the 
extent  of  the  difference  between  the  bullion  value  and  the  face  value  of  all  silver 
which  we  might  choose  to  coin. 


364  THE    QUESTIONS    OF    THE    DAY. 

debts,  public  and  private.  Whether  or  not  this  shall  be  done 
is  the  money  "  question  of  the  day." 

From  the  discussion  of  this  question  it  is  desirable  to 
eliminate  two  subsidiary  questions: — 

First,  shall  the  United  States  bonded  debt  be  paid  in 
silver?  By  its  terms  it  is  payable  in  "  coin,"  and  silver  is  coin. 
At  the  same  time  it  has  not  for  a  very  long  time  been 
customary  anywhere  in  the  world  to  employ  silver  in  these 
very  large  transactions,  and,  although  silver,  when  our  earlier 
bonds  were  issued,  was  worth. more  than  gold  at  a  ratio  of 
sixteen  to  one,  no  creditor  would  expect  silver  in  payment, 
because  the  custom  was  to  use  gold  in  such  payments.  When 
our  later  bond  issues  were  made,  and  for  the  express  purpose 
of  strengthening  vuv  credit  in  borrowing  money,  Congress 
explicitly  pledged  the  nation  to  keep  all  currency  issued'  by  it 
on  an  equality  with  gold.  Many  millions  of  our  bonds  have 
been  issued  on  the  strength  of  that  pledge,  and  if  any  are  out- 
standing of  earlier  issues,  they  have  continually  changed 
hands  on  the  strength  of  it.  The  faith  of  the  nation  is 
unquestionably  pledged  to  the  payment  of  these  bonds  in 
gold,  which  was  received  for  all  issued  since  the  war,  and  the 
pledge  must  be  made  good.  To  pay  the  national  debt  in 
silver  would  be  repudiation  to  the  extent  of  the  difference  in 
value,  and  would  not  only  be  dishonest,  but  unspeakably  silly. 
Our  national  credit  would  be  gone,  and  when  we  need  to 
borrow  money  again,  we  should  be  compelled  to  pay  well  for 
it  or  go  without  it.  The  fact  that  our  credit  was  poor  would 
make  us  a  weak  nation,  certain  to  be  imposed  upon  by  other 
nations.  This  would  require  increased  taxation  for  defense, 
and  in  one  way  and  another  we  should  pay  very  dearly  for 
our  dishonesty.  In  modern  times  the  ability  to  borrow 
money  cheaply  goes  far  to  take  the  place  of  a  standing  army 
and  a  great  navy.  While  the  intent  to  pay  the  national  debt 
in  silver  may  be  inferred  from  the  specific  demand  that  it  be 
— as  it  is  now — a  legal  tender  for  that  purpose,  and  while 
many  who  are  presumably  ignorant  of  the  equities  of  the  case, 
honestly  believe  that  it  should  be  so  paid,  it  is  impossible  to 
suppose  that  such  a  thing  should  ever  be  officially  proposed 


THE    FARMKR    AND    TIIK    CURRENCY.  365 

except  by  some  demagogue  who  hopes  to  win  favor  from  the 
ignorant.  At  any  rate  I  decline  to  consider  it  as  a  debatable 
question  or  include  it  as  a  "  question  of  the  day." 

Secondly,  in  the  event  of  the  adoption  of  free  coinage  of 
silver,  is  tlie  United  States  to  stand  pledged,  as  it  is  now,  to 
maintain  all  silver  coined  by  it  at  a  ratio  of  sixteen  to  one 
with  gold  ?  This  question,  so  far  as  I  know,  lias  never  been 
made  a  matter  of  prominent  popular  discussion.  No  demand 
has  ever  been  made  by  the  advocates  of  silver  for  any  change 
in  the  existing  law,  and  in  the  absence  of  a  change  the  United 
States  would  stand  so  pledged.  At  present  prices  of  silver 
bullion,  under  such  an  arrangement,  any  one  with  $100  in 
gold  could  buy  silver  for  which,  wlien  coined,  he  could  get 
-|200  in  gold.  It  is  needless  to  say  that  we  should  all  of  us 
drop  everything  else  antl  do  this.  It  is  the  belief  of  the 
advocates  of  free  coinage  that  this  scramble  for  silver  to  dumj) 
onto  the  country  would  result  in  the  immediate  rise  of  silver 
to  its  old  ratio  with  gold.  That  some  rise  would  occur  is 
practically  certain;  that  any  such  rise  as  would  fully  protect 
the  treasury  would  occur,  no  competent  person  believes;  at  an}^ 
rate,  the  risk  would  be  too  great;  the  United  States  alone  can 
not  afford  to  pledge  itself  to  make  good  the  difference  in  value 
between  the  silver  and  gold  of  the  world;  none  of  us  are 
willing  to  be  taxed  for  any  such  purpose,  or  to  take  any 
chance  of  it.  I  shall  assume,  also,  that  this  is  not  a  practical 
question,  but  that  should  we  adopt  free  coinage  of  silver,  the 
United  States,  as  to  all  silver  coined  after  that  date,  would 
assume  no  responsibility  excei^t  for  weight  and  fineness. 
The- new  dollars  must  take  their  chance.  They  would  be  legal 
tender. 

Under  such  an  arrangement  no  competent  person  will 
undertake  to  predict  what  would  happen,  except  in  a  very 
general  way.  The  more  competent  the  person,  the  more  cer- 
tainly he  would  not  predict;  but  all  well-informed  persons 
believe  that  gold  would  immediately  disappear  from  circula- 
tion in  this  country,  and  that  silver  would  rise,  as  compared 
with  gold,  to  some  ratio  intermediate  between  that  at  present 
existing  and  the  nominal  ratio  of  sixteen  to  one.     The  real 


366  THE    QUESTIONS    OF    THE    DAY. 

"question  of  the  day"  is  whetlier  we  shall  change  from  the 
gold  standard  to  a  silver  standard,  and  even  those  who  have 
most  faith  in  a  rise  of  silver  realize  that  they  must  defend  the 
silver  basis  in  order  to  win. 

There  is  one  alternative  which  may  as  well  be  mentioned 
here.  If  the  United  States  and  the  principal  commercial 
nations  of  Europe  would  agree  to  coin  both  gold  and  silver 
freely  as  deposited,  making  both  legal  tender  at  a  uniform 
ratio,  it  is  the  concensus  of  well-informed  opinion  that  the 
two  metals  would  remain  at  that  ratio  indefinitely,  except  in 
the  case  of  events  not  reasonably  to  be  expected.  There  is 
not,  however,  agreement  that  they  could  be  maintained  at 
sixteen  to  one,  some  thinking  that  the  ratio  would  need  to  be 
as  high  as  twenty  to  one,  even  if  all  commercial  nations  were 
to  unite.  I  know  of  no  way  of  determining  this  without  trial. 
It  is  not  likely,  however,  to  be  tried.  Repeated  attempts  by 
this  country  to  induce  European  nations  to  unite  with  us  in 
remonetizing  silver  have  made  it  evident  that  other  nations 
will  not  join  unless  England  comes  in,  and  that  England,  at 
least  for  the  present,  will  refuse.  The  reasons  assigned  by 
Great  Britain  for  her  refusal  to  join  in  such  a  movement,  are 
those  usually  assigned  by  the  advocates  of  gold  monometalism. 
The  strongest  reason,  however,  is  believed  to  be  one  not  offi- 
cially given,  which  is  the  belief  of  a  controlling  majority  that 
Great  Britain,  as  a  creditor  nation,  is  directly  interested  in 
preventing  money  from  being  easier  to  get.  A  minority,  how- 
ever, even  there,  think  that  England's  prosperity  can  best  be 
promoted  by  the  prosperity  of  the  world,  and  that,  unless 
prices  begin  to  rise,  the  loss  of  debts  by  bankruptcy,  and  the 
loss  of  trade,  will  more  than  offset  any  possible  gain  by  the 
maintenance  of  low  prices,  and  so  believe  it  to  be  in  the 
interest  of  Great  Britain  to  unite  with  other  nations  in  remonet- 
izing silver.  Besides,  there  are  many  debtors  in  Great  Britain 
itself.  But  for  the  present  there  is  no  likeliliood  that  Great 
Britain  will  abandon  her  exclusive  gold  standard,  and  hence 
no  likelihood  of  international  bimetalism.  This  is  not,  how- 
ever, a  "question  of  the  day"  in  America.  There  is  an  over- 
wlielming  majority  in  favor  of  it.  Its  adoption  depends  upon 
other  nations. 


THE    FARMER    AND    THE    (TRRENCY.  3()7 

It  is  also  proposed  by  some  that  if  the  United  States  alone 
should  undertake  to  find  sufficient  use  for  silver  to  materi- 
ally raise  the  ])rice  of  the  world's  stock  of  silver,  it  should 
not  attempt  to  raise  it  to  the  ratio  of  sixteen  to  one,  which 
very  few  believe  it  can  do,  but  that  it  should  expend  its  effort 
towards  something  easier,  in  which,  as  they  claim,  there  is  a 
fjiir  chance  of  success.  They  tlierefore  propose  that  we  estab- 
lish free  coinage  of  silver  at  a  ratio  of  twenty  to  one,  or  even 
twenty-four  to  one.  If  in  this  manner,  as  they  claim,  the 
United  States  can  raise  the  market  price  of  the  world's  stock 
of  silver  even  to  one  of  those  ratios,  we  shall  have  gained 
much  while  still  retaining  the  advantage  of  an  international 
currency.  This  proposal,  however,  has  so  far  received  little 
indorsement  in  this  country,  although  in  the  discussions  relat- 
ing to  international  currency  it  has  strong  advocates.  It  is 
possible,  at  any  time,  that  the  discussion  may  center  on  this 
proposition  even  here,  but  at  present  the  advocates  af  silver 
say  "sixteen  to  one  or  nothing,"  and  their  .opponents  oppose 
any  action  whatever  by  the  United  States  alone.  And  so  the 
issue  is  made  up. 

The  imi)ortant  arguments  on  both  sides  of  this  question 
can  be  stated  quite  briefly,  but  their  proper  apprehension 
requires  the  presentation  of  one  or  two  other  matters  not  yet 
alluded  to.  It  may  be  assumed  that  as  the  world's  stock  of 
money  increases,  prices,  other  things  remaining  equal,  will 
rise;  and  that  if  money  decreases,  or  even  remains  stationary 
while  commodities  and  exchanges  increase,  prices  will  fall. 
While  assuming  this,  however,  I  have  hitherto  made  no  dis- 
tinction between  money  used  to  pay,  on  the  spot,  for  purchases, 
and  promises  to  pay  money  in  the  future.  In  transactions  of 
this  latter  kind  money  is  said  to  be  a  "standard  of  deferred 
payments."  It  is  obvious  that  when  money  is  received  on 
delivery  of  goods,  and  immediately,  or  soon,  paid  out  again 
in  other  transactions,  the  rise  or  fall  in  the  value  of  money  is 
of  slight  importance  in  the  deal,  although  it  is  true  that 
when  prices  are  believed  to  be  steadily  falling  the  number  of 
transactions  will  be  less,  as  men  tend  to  stop  production  of 
goods  on  a  falling  market;  but  considered  merely  as  a  meas- 


368  THE    QUESTIONS    OF    THE    DAY. 

ure  of  value,  fluctuations  do  not  seriously  affect  individuals 
in  their  cash  transactions.  But  when  debts  are  to  run  a  long 
time,  as  usually  in  tiie  case  of  mortgage  loans,  the  change  in  the 
value  of  money  may  become  very  distressing  either  to  credit- 
ors or  debtors,  according  as  prices  rise  or  fall.  The  change  in 
the  value  of  United  States  money  which  occurred  between  1861 
and  1863-64  worked  great  hardship  to  creditors;  those  which 
have  been  taking  place  since  have  worked  great  hardship  to 
debtors.  In  the  case  of  public  debts,  usually  running  for  a 
long  term  of  years,  the  difference  may  become  very  great.  It 
would,  in  1898,  have  required  the  sale  of  forty  per  cent  more 
commodities  to  pay  the  national  or  any  private  debt  than 
would  have  paid  debts  to  the  same  amount  in  1870.  It  is 
really  over  money  as  a  standard  of  deferred  payments  that 
political  controversy  principally  rages. 

We  are  continually  speaking  of  money  as  a  "standard." 
Now  a  "standard"  is  supposed  to  be  something  which  does 
not  vary,  and  as  a  matter  of  fact  it  is  claimed  by  some  that 
money,  or  at  least  gold,  does  not  vary,  but  that  the  variation 
of  prices  is  merely  an  indication  of  the  variation  of  the  value 
of  commodities.  There  must  be  some  way  of  settling  this 
preliminary  matter  or  we  can  not  get  on  at  all.  It  is  evident 
that  gold  and  silver  are  "commodities,"  as  much  as  wheat  or 
iron,  for  they  are  constantly  bought  and  sold  in  the  market  as 
bullion,  without  reference  to  their  use  as  money.  It  is  claimed, 
however,  that  on  account  of  their  great  value  they  are  care- 
fully preserved,  that  the  waste  is  small,  and  that  the  accumu- 
lations of  ages  have  now  become  so  enormous  that  the  annual 
additions,  however  large,  have  but  a  trifling  effect  on  the  total 
volume.  Wheat,  on  the  contrary,  is  consumed  almost  as  fast 
as  produced,  so  that  price  is  immediately  and  greatly  affected 
by  the  annual  supply,  and  that  as  to  iron,  while  comparatively 
indestructible,  it  is  so  cheap,  and  used  in  such  enormous  quan- 
tities for  purposes  for  which  demand  is  constantly  changing, 
that  this,  also,  constantly  varies  in  value.  Taking  these  as 
illustrations  it  has  been  claimed  that,  while  perhaps  not 
actually  stable,  the  precious  metals,  and  especially  gold,  are 
so  much  more  stable  than  any  other  known  substance  as  to 


THE  FARMER  AND  THE  CURRENCY.  309 

be  on  the  whole  a  very  satisfactory  standard,  and  at  any  rate 
the  best  that  can  be  had,  and  that  we  shall  all  be  better  off 
if  we  assume  it  to  be  the  standard,  and  govern  ourselves 
accordingly  without  worrying. 

When  we  come  to  look  deeply  into  the  matter  we  are 
indeed  compelled  to  confess  tiiat  in  regard  to  value  there 
is,  and  apparently  can  be,  no  single  substance  which  by 
any  course  of  reasoning  can  be  shown  to  be  a  satisfactory 
standard  of  value,  and  that  in  fact  no  one  has  yet  been  able  to 
see  how  in  any  way  we  can  get  such  a  standard.  The  best 
thing  we  can  do,  or,  at  all  events,  the  best  thing  any  one  has 
yet  been  able  to  suggest,  is  to  compare  one  or  two  commod- 
ities with  the  aggregate  of  all  other  commodities,  the  latter 
being  taken  as  the  standard. 

It  is  evident  that  if  we  had  a  complete  list  of  everything 
bought  and  sold  in  the  world,  with  the  exact  quantity 
used  of  each  in  a  given  time,  and  the  totals  of  tiie  sums 
paid  for  each  commodity  for  that  time,  we  could  obtain,  by 
dividing,  the  exact  average  price  for  each  commodity  at 
that  time,  and  the  aggregate  sum  paid  for  the  whole.  If, 
then,  the  next  year,  and  thereafter  each  successive  year, 
we  should  repeat  the  operation,  always  using  the  same 
quantity  of  each  commodity,  but  the  prices  current  in 
each  year,  we  should  be  able,  by  comparing  the  aggregate 
sums  paid,  to  know  whether  prices  had  risen  or  fallen. 
Usually  the  aggregate  i)rices  would  be  found  not  far  apart,  for, 
although  the  prices  of  tlie  articles  might  not  be  the  same  in  any 
successive  years,  yet  as  some  would  certainly,  according  to  all 
human  experience,  be  higher,  and  some  lower,  these  would 
tend  to  balance,  and  the  aggregate  remain  the  same.  But  in 
this  case  we  compare  tiie  aggregate  of  all  commodities,  with 
their  compensating  tendencies,  with  a  single  commodity,  gold, 
or,  at  most,  with  gold  and  silver.  It  is,  tlierefore,  more  reason- 
able to  assume  the  aggregate  of  all  commodities  as  the 
standard,  and  if  the  aggregate  of  money  paid  is  larger,  to  say 
that  money  has  fallen,  and  if  less,  that  money  has  appreciated. 

Now  while  it  would  not  be  possible  to  enumerate  all  the 
commodities  bought  and  sold  in  the  world,  much  less  to 
24 


370  THE    (QUESTIONS    OF    THE    DAY. 

ascertain  the  c^uajitities  used  of  each,  and  the  prices  paid,  it  is 
possible  to  take  a  large  number,  and  of  many  to  determine  the 
approximate  amounts  used,  and  the  current  prices  for  a  long 
series  of  years;  and  this  has  been  done.  As  the  aggregate 
sums  each  year,  however,  would  be  unwieldy  and  inconven- 
ient, quite  impossible  to  remember,  and  difficult  to  compare, 
the  aggregate  of  the  first  year  is  usually  taken  as  one  hundred, 
and  those  for  the  succeeding  years  at  the  proper  percentage 
over  or  under  one  hundred,  as  the  case  may  be.*  These 
numbers  are  called  "index  numbers,"  and  are  taken  by 
economists  the  world  over  as  the  standards  by  which  to  com- 
pare money.  No  one  pretends  that  they  are  perfect  standards, 
but  only  that  they  are  the  best  we  have.  They  are  imperfect 
as  standards  to  measure  money  by,  not  only  by  reason  of 
imperfections  in  their  construction,  but  because  prices   are 


*  The  method  of  constructing  the  index  tables  is  very  simple,  the  difficulty 
lying  in  the  selection  of  proper  articles,  giving  each  its  due  weight  in  the 
table,  and  in  the  labor  of  ascertaining  the  current  prices.  Disregarding  all 
niceties  of  construction,  and  not  attempting  to  quote  actual  prices,  let  us 
suppose  that  we  were  constructing  an  index  table,  beginning  with  the  year 
1880,  and  that  the  average  prices  of  five  commodities  for  three  years  were  as 
follows,  the  same  quantity  of  each  commodity  being  taken  in  each  year; — 

1880  1881  1882 

100  bushels  wheat $90.00  $100.00  $75.00 

100  pounds  beef. 8.00  6.00  5.00 

100  yards   sheeting 12.00  9.00  10.00 

100  gals,  olive-oil 100.00  125.00  115.00 

1  ton  pig  iron 30.00  20.00  25.00 

Total $240.00  $260.00  |230.00 

Average 48.00  52.00  46.00 

Index  numbers 100.00  108.00  96.00 

It  is  evident  in  this  case  that  the  commodities  which,  in  1880,  could  be 
bought  for  $240,  would  cost  $260  in  1881,  and  $230  in  1882.  If  for  conven- 
ience we  take  100  to  represent  the  price  in  1880,  as  an  index  number,  com- 
putation by  the  "rule  of  three  "  will  give  108,  and  96  as  the  index  numbers  for 
the  two  following  years.  The  (-peration  is,  disregarding  fractions, 
240  :  260  :  :  100  :  108 

All  index  tables  are  compiled  in  a  similar  manner,  a  larger  number  of 
articles  being  taken,  with  care  to  obtain  correct  prices. 


THE  FARMER  AND  THE  CURREN'CY.  371 

affected  by  other  things  than  abundance  or  scarcity  of  money. 
The  tables  are  used  by  those  upon  all  sides  of  monetary  con- 
troversy to  sustain  their  views.  From  these  and  other  tables 
diagrams  may  be  constructed  to  represent  quickly  to  the  eye 
whatever  tlie  tables  may  teach.  Some  things  can  be  thus 
shown  with  entire  accuracy,  as,  for  example,  the  appreciation 
of  gold  as  compared  with  silver,  or  tlie  depreciation  of  silver  as 
compared  with  gold,  as  one  may  prefer  to  term  it.  In  this 
case  there  are  but  two  commodities  concerned,  and  their 
variation  may  be  shown  with  entire  accuracy,  but  where  a 
large  number  of  elements  come  in,  it  is  not  always  so  easy  to 
determine  what  the  lesson  of  the  table  or  the  diagram  actually 
is.  A  number  of  tables,  diagrams,  and  other  statistical 
matter,  will  be  found  in  Appendix  G,  to  which  the  reader 
is  referred  for  the  material  for  an  exhaustive  study  of  the 
currency  question. 

The  argument  for  the  single  gold  standard  may  be  stated 
as  follows,  in  the  language  of  a  supposed  earnest  advocate  of 
that  policy : — 

I.  It  is  just.  The  variation  of  prices  is  not  caused  by  the 
appreciation  of  metallic  money,  the  volume  of  which  increases 
as  steadily  as  that  of  other  commodities,  indeed  more  steadily, 
since  nothing  else  is  so  carefully  preserved  from  destruction, 
but  by  the  decrease  of  cost  of  production  of  commodities.  As 
production  and  transportation  are  cheapened  by  modern  proc- 
esses, prices  must  decrease,  and  in  so  doing  will  still  leave  the 
same  margin  of  profit  to  the  producer  and  transporter.  Tiie 
late  fall  of  prices  in  the  United  States  by  no  means  represents 
a  real  fall  in  values,  but  a  squeezing  out  of  imaginary  values 
which  never  really  existed,  and  this  is  true  not  only  of  such 
property  as  is  usually  represented  by  stocks  and  bonds,  and 
exhibited  in  failures  of  manufacturing  enterprises,  and  the 
"reorganization"  of  railroads,  but  of  real  estate,  which,  espe- 
cially in  the  west,  has  been  held  at  highly  inflated  values,  upon 
which  it  could  not  possibly  be  made  to  earn  interest.  What 
we  call  a  fall  in  value  is  therefore  nothing  but  a  sudden  real- 
ization of  true  value,  and  the  shattering  of  hopes  which  had 
.never  any  real  foundation.     Statesmanship  considers  the  per- 


372  THE    QUESTIONS    OF    THE    DAY. 

maneiit  welfare  of  nations,  and  will  not  seek  to  relieve  one 
generation  which  is  suffering  from  the  reaction  from  an  infla- 
tion of  values  of  property,  by  plunging  it  into  a  new  era  of 
speculation  in  inflated  money,  certain  in  time  to  react  upon 
another  generation,  causing  the  people  distress  like  that  wlncli 
we  have  endured.  Statesmanship  is  just  not  only  as  between 
individuals,  but  between  generations. 

As  between  gold  and  silver  it  is  the  fact  that  gold  has  long 
been  used  in  large  transactions  in  commercial  nations,  to  tlie 
exclusion  of  silver,  by  reason  of  its  greater  convenience  and 
smaller  cost  of  transportation  and  storage;  and  as  transactions 
constantly  tend  to  grow  larger,  the  increasing  demand  for  gold, 
without  corresponding  reduction  in  cost  of  production,  has 
kept  its  value  steady  with  respect  to  commodities  at  their 
decreasing  cost,  while  silver  has  depreciated  by  reason  of  new 
discoveries  and  great  economies  of  production,  without  corre- 
sponding increase  of  demand  either  for  money  or  in  the  arts. 
The  facts  show  that  silver  production  continues,  even  at  its 
present  low  prices;  geology  teaches  us  that  the  supplies  of 
silver  in  the  earth  are  practically  inexhaustible,  and  it  is  plain 
that  any  increase  of  price  would  at  once  cause  the  working  of 
the  best  of  the  enormous  deposits  of  low-grade  ore  whose  loca- 
tions are  known,  but  which  can  not  now  be  profitably  worked, 
and  that  if  by  remonetization  or  any  otlier  means  the  pur- 
chasing power  of  silver  could,  for  the  time,  be  doubled,  as 
is  imagined,  silver  mining  under  modern  processes  would 
become  the  most  profitable  industry  knov^ai,  and  the  world 
would  be  inundated  with  such  a  flood  of  it  that  the  power  of 
all  the  governments  of  the  earth  would  be  wholly  insufficient 
to  maintain  any  ratio  between  silver  and  gold  materially 
different  from  that  of  the  relative  co.st  of  the  production  of 
the  two  metals.  The  depreciation  of  silver  is  therefore  the 
inevitable  result  of  economic  forces  of  irresistible  power,  and 
correctly  represents  the  value  of  that  metal  as  compared  with 
gold.  Dealings  upon  the  gold  basis  are  therefore  just,  and 
dealings  upon  any  other  basis  are  unjust,  and  the  consequences 
of  any  attempt  to  enforce  such  dealings  will  inevitably  fall  on 
the  least  informed  and  least  organized,  nmong  whom  are  car-- 


THE    FARMER    AND    TflE    CURRENCY.  373 

tainly  the  farmers.  Under  present  conditions  the  production 
of  gold  is  rapidly  increasing,  which,  in  due  time,  will  cause  an 
increase  of  prices. 

II.  It  is  expedient.  Justice  is  always  expedient.  The 
serious  proposal  to  admit  silver  to  free  coinage  in  this  country 
was  sufficient  to  seriously  affect  credit  and  is  responsible  for  a 
great  part  of  the  business  troubles  of  the  past  few  years.  Men 
will  not  invest  in  business,  or  lend  money  to  be  so  invested, 
while  they  fear  that  their  returns  may  be  in  a  currency  which 
they  do  not  desire.  Arguments  based  upon  prophecies  of 
general  prosperity  are  of  no  avail.  What  men  with  money 
think  of  is  their  own  prosperity.  They  put  in  gold,  and  wish 
to  know  that  they  are  to  take  out  gold.  If  this  country  does 
not  wish  their  gold  on  these  terms,  they  will  send  it  elsewhere. 
The  success  of  a  party  pledged  to  the  adoption  of  free  coinage 
would,  for  this  reason,  absolutely  }>aralyze  business  until  the 
new  basis  should  be  established.  This  period  might  extend 
from  the  November  elections  in  one  year  till  some  time  in  the 
summer  of  the  second  year,  and  must  do  so  unless  an  extra 
session  of  Congress  w^re  called.  This  entire  period  would  be 
such  a  season  of  distress  as  no  country  has  ever  witnessed 
in  modern  times.  There  would  be  a  universal  scramble  for 
gold,  and  an  equal  universal  refusal  to  lend  it,  on  any  terms 
which  legitimate  business  could  pay,  because  it  could  be  more 
profitably  employed  in  speculation.  Foreign  holders  of  Amer- 
ican securities  would  become  alarmed  and  return  tliem  to  this 
country  for  sale  at  prices  far  below  their  value.  Of  course 
this  would  be  foolish,  because  those  securities  are  as  valuable 
in  foreign  hands  as  in  those  of  our  own  people,  but  capitalists 
are  as  easily  j)anic-stricken  as  other  people,  and  the  return  of 
these  securities  could  be  absolutely  depended  upon.  Our  own 
capitalists  would  be  better  informed  as  to  these  securities  tlian 
foreigners,  and  would  use  their  knowledge  to  profit  by  tiie 
{)anic  of  foreigners;  but  it  would,  for  the  time,  lock  up  money 
all  the  same.  Such  money  as  should  be  absolutely  required 
to  "move  crops"  could,  of  course,  be  had,  but  at  high  prices, 
which  would  mean  low  prices  for  crops,  foreclosurers  of  mort- 
gages, stoppage  of  manufactures,  and  mercantile  failures.     The 


'3T4  thj:  questions  of  the  day. 

gold  would  disappear,  while  yet  there  was  no  provision  for 
other  currency.  Property  of  all  kinds  would  be  in  the  market 
at  ruinous  prices  and  be  bought  up  by  speculators.  Granting 
all  that  the  advocates  of  free  coinage  claim  as  to  the  injustice 
which  lias  been  wrought  upon  the  debtor  classes  by  the 
alleged  appreciation  of  gold,  the  attempt  to  remedy  it  by  a 
sudden  inflation  of  money  by  free  coinage  could  only  result  in 
additional  losses  tenfold  greater,  during  the  interim  between 
deciding  to  change  to  a  silver  basis  and  the  actual  accomplish- 
ment of  the  act.  These  losses  would  not  fall  wholly  upon  the 
rich,  wlio  in  one  way  or  another  would  know  how  to  protect 
themselves,  nor  upon  the  unindebted,  who  could  doubtless 
live,  but  on  the  debtor  classes,  who  are  clamoring  for  free  coin- 
age. It  is  true  that  the  actual  unincumbered  owners  of  the 
property  of  the  nation,  as  they  would  be  when  the  legislation 
was  completed,  and  the  new  silver  coinage  began  to  circulate, 
might  look  forward  to  an  era  of  rising  prices,  as  measured  in 
a  rapidly  depreciating  currency;  that  rising  prices  excite  hope 
and  confidence,  and  lead  to  renewed  effort,  general  employ- 
ment, and  increased  production ;  but  prices  can  not  continue 
to  rise  indefinitely;  sometime  they  must  reach  a  limit,  and  if 
ail  former  human  experience  is  a  guide,  must  fall  from  that 
j)oint.  Inspection  of  the  diagrams  of  prices  shows  that  they  are 
never  stal)le,  but  are  always  rising  and  falling,  in  more  or  less 
defined  cycles;  and  so  long  as  they  move  slowly  and  regularly 
along  a  general  level,  that  is  the  normal  and  most  pros])orous 
condition  of  business;  whereas,  all  nbiionnal  increases,  whether 
caused  by  inflation  of  currency,  or  speculative  ideas  of  the 
value  of  property,  have  been  invariably  followed  by  corre- 
sponding abnormal  depressions,  with  all  their  accompanying 
distress.  We  liave  lately  been  nt  the  bottojn  of  such  an  abyss; 
many  inevitable  liquidations  have  taken  place;  doubtless  there 
may  be  yet  some  more  to  come;  but  in  the  main  business  has 
adjusted  itself  to  the  actual  relations  of  commodities  and  gold. 
All  loans  made  or  renewed  by  the  great  money-lending- 
agencies  are  now  made  payable  in  gold  coin ;  no  money  can 
now  be  borrowed  in  the  money  market,  on  long  time,  except 
upon  such  agreements.     Almost  the  only  cases  in  which  mort- 


THE  FARMER  AND  THE  CURRENCY.  S i !) 

gages  are  now  made  payable  in  "lawful  money"  are  those  for 
deferred  payments  due  to  the  seller  of  tlie  land.  There  are 
many  of  these,  held  by  fanners,  who,  in  case  of  free  coinage, 
would  lose  the  difference  between  the  gold  value  and  the  silver 
value  of  the  face  of  the  note.  If  any  farmer  doubts  that  such 
a  mortgage  is  even  now  depreciated,  let  him  try  to  sell  one  to 
a  bank. 

Another  matter  to  be  considered  is  the  life-insurance  inter- 
est. Tbe  amount  of  life  insurance  outstanding  in  this  country 
is  enormous.  With  free  coinage  of  legal  tender  silver,  such 
insurance  would  be  payable  in  the  depreciated  money.  In  a 
multitude  of  cases  the  policies  are  assigned  for  debt,  or  ke[)t 
up  for  the  purpose  of  paying  off  a  mortgage  on  a  homestead, 
on  the  death  of  the  father  of  the  family.  Under  free  coinage 
the  value  of  this  insurance  as  security,  or  for  the  protection 
of  a  family,  would  be  enormously  depreciated.  In  like  manner 
deposits  in  savings  banks  would  depreciate,  except  as  they  are 
being  protected  in  making  or  extending  loans,  by  contracting 
for  gold  payments. 

The  amount  of  indebtedness  that  would  be  relieved  by  free 
coinage  is  enormously  exaggerated.  Short-time  indebtedness, 
while  of  huge  proportions,  does  not  count,  as  for  the  most 
part  every  such  debt  involves  a  corresponding  credit.  The 
manufacturer  borrows  from  the  bank,  but  has  a  corresponding 
note  coming  from  the  jobber;  the  jobber  has  the  note  or 
account  of  the  retail  merchant,  who  in  turn  has  tlie  obligation 
of  the  farmer,  who  must  dig  up  the  money.  If  free  coinage 
were  seen  to  be  coming,  he  would  be  made  to  pay  while  yet  he 
could  be  made  to  pay  gold,  and  in  default  of  payment  would 
be  sued.  The  only  indebtedness  which  could  in  any  case  be 
"relieved"  by  free  coinage  would  be  mortgage  debts  not 
specifically  payable  in  gold,  which  should  not  become  due 
until  the  silver  basis  was  established,  and  upon  which  interest 
should  be  carefully  kept  up  so  that  the  principal  could  not  be 
declared  due  in  advance  of  maturity.  With  every  day  this 
class  of  indebtedness  grows  less;  before  any  change  of  the 
money  basis  could  be  made,  very  little  would  remain.  It  is 
not  worth  while  to  invite  certain  calamity  to  all  other  interests 


376  THE    QUESTIONS    OF    THE    DAY. 

for  the  sake  of  relieving  this  small  remnant  of  the  old  form 
of  debt,  even  if  it  could  be  relieved  by  free  coinage. 

Finally,  the  gold  standard  is  the  more  stable,  because  inter- 
national, and  therefore  less  liable  to  disturbance  from  local 
causes.  A  currency  which  is  national  only,  as  between  the 
nations  recognized  as  commercial,  would  constantly  fluctuate 
from  causes  arising  within  the  country — as  popular  agitations 
for  changing  the  coinage,  the  exhaustion  or  discovery  of  mines, 
and  the  like,  which  would  not  affect,  or  would  affect  in  a  mucli 
less  degree,  money  circulating  at  full  face  value  among  all 
commercial  nations.  The  natural  and  most  desirable  stand- 
ard of  money  is  that  used  in  the  largest  transactions,  and 
which  is  universally  recognized  as  money.  As  a  matter  of  fact, 
since  silver  and  gold  have  never  yet  remained  .stationary  in 
any  country  at  any  ratio,  it  is  reasonable  to  suppose  that  they 
never  will.  Whatever  we  may  say,  or  whatever  fiction  of  law 
we  may  adopt,  the  real  standard  will  always  be  either  gold  or 
silver,  and  gold  is  the  best  and  most  just.  In  so  far  as  we 
have  obligations  not  yet  due,  payable  in  "lawful  money,"  either 
to  foreigners  or  our  own  people,  it  would  probably  be  a  relief 
to  the  immediate  debtors  to  pay  them  in  depreciated  silver. 
As,  however,  all  such  obligations  have  been  contracted  under 
the  pledge  of  the  nation  to  maintain  all  currency  authorized 
bv  it  on  a  par  with  gold,  the  creditors,  in  such  cases,  would 
consider  themselves  cheated,  and  when  other  Americans,  as  is 
sure  to  nappen,  wish  to  borrow  money,  they  either  could  not 
get  it,  or  would  be  compelled  to  pay  dearly  for  it.  This  would 
result  in  relieving  present  debtors  at  the  expense  of  future 
debtors.  This  is  not  good  statesmanship  and  would  not  pay. 
We  want  sound  money. 

The  above  is  the  argument  for  a  gold  standard  condensed 
into  the  strongest  form  in  which  I  am  able  to  express  it. 

The  argument  for  free  coinage  of  silver  by  the  United 
States,  regardless  of  the  action  of  other  nations,  at  the  ratio  of 
sixteen  to  one,  both  gold  and  silver  to  be  full  legal  tender, 
may  be  stated  as  follows,  in  the  language  of  a  supposed  earnest 
advocate  of  that  policy: — 

I.    It  is  just.      The  fall  of  prices  can   by  no  means  be 


THE  FARMER  AND  THE  CURRENCY.  377 

accounted  for  by  decreased  costs  of  production.  Even  if  this 
could  not  be  demonstrated  as  to  some  particular  articles,  as  to 
large  classes  of  products  something  more  than  decreased  costs 
is  certainly  needed  to  account  for  the  low  prices.  This  is 
especially  the  case  in  regard  to  agricultural  products.  The 
decreased  cost  of  manufactured  articles  depends  largely  upon 
what  economists  call  the  "law  of  increasing  returns,"  which  is 
that  as  capital  is  increased  and  concentrated  upon  the  manu- 
facture of  single  articles  in  great  quantities,  costs  are  decreased 
and  returns  per  unit  of  capital  increased.  While  this,  how- 
ever, is  recognized  as  true  in  respect  to  many  industries, 
economists  are  equally  agreed  that  it  does  not  apply  to 
agricultural  operations,  but  that,  on  the  contrary,  they  are 
governed  by  the  "law  of  diminishing  returns,"  which  means 
that  after  passing  a  point  easily  reached,  costs  can  not  be 
decreased  by  the  application  of  additional  capital,  but,  on  the 
contrary,  will  tend  to  increase  with  decreasing  returns  per 
unit  of  invested  capital.  As  a  matter  of  fact,  costs  of  agricul- 
tural products  have  not  decreased  in  any  important  degree; 
the  apparent  reduction  at  points  of  consumption  is  mainly 
due  to  decreased  costs  of  transportation,  the  farm  costs 
remaining  very  much  as  they  formerly  were;  interest  is  not 
less;*  land  did  not  fall  until  forced  down  by  continued  low 
prices  of  produce;  the  cost  of  living  has  not  decreased,  by 
reason  of  the  advancing  standard  of  life;  farm  wages  have  not 
fallen  in  any  important  degree,  or  much  more  than  in  other 
avocations,  in  which,  in  fact,  wages  have  not  fallen  at  all, 
except  by  irregularity  of  employment,  but  have  tended  to  an 
actual  rise,  and  their  purchasing  power  has  increased  enor- 
mously; tlie  alleged  low  costs  of  the  so-called  "bonanza" 
grain   farms    are    assumed;    these    assumptions    rest  on   no 


*  Interest  On  farm,  loans  is  not  less.  Interest  on  money  in  large  amounts, 
upon  security  believed  to  be  unimpeachable,  has  fallen,  and  a  few  economists 
have  insisted  that  conceding  the  appreciation  of  gold,  the  appreciation  has  been 
made  good  by  the  foil  in  interest.  There  is  a  monograph  by  Prof.  Irving 
Fisher,  of  Yale  Univei-sity,  taking  this  view,  among  the  publications  of  the 
American  Economic  Society.  I  can  find  little  or  no  trace  of  any  fall  in  the 
retail  price  of  money — that  is,  in  the  interest  on  small  loans. 


378  THE    QUESTIONS    OF    THE    DAY. 

authentic  data,  as  these  concerns  do  not  publish  their  balance 
sheets;  there  is  no  reason  to  suppose  that  even  by  the  rapid 
robbing  of  nature  by  machinery  have  bonanza  farmers  been 
able  to  reduce  average  costs  below  those  of  ordinary  farming; 
the  quantity  of  grain  produced  by  "extensive"  farming  is  but 
a  small  part  of  the  grain  produced  in  the  world,  and  if  costs 
were  reduced,  the  bonanza  farmers  would  be  able  to  save  the 
profit  for  themselves,  since  prices,  so  far  as  affected  by  supply, 
would  be  regulated  by  the  great  bulk  of  grain  produced  in 
the  thickly  settled  and  most  fertile  rural  districts,  and  not  by 
the  comparatively  small  amount  produced  by  machinery  on 
great  plains.     As  to  savings  by  the  use  of  machinery  by  small 
farmers,  it  is  an  open  question  whether  there  are  savings;  the 
prices  paid  by  farmers  for  machinery  are  usually  exorbitant, 
and  for  "repairs"  still  worse;    machinery  is   usually  bought 
"on  time,"  at  rates  of  interest  which  no  industry  can  afford, 
and  the  annual  waste  by  carelessness  and  neglect  is  fearful ;  it 
can  neither  be  affirmed  nor  denied  with  much  assurance  that 
the  use  of  the  more  expensive  machinery  has  reduced  the  cost 
of  agricultural  products,  but  conceding  that  there  has  been 
some  reduction  from  this  cause,  it  is  not  much,  nor  does  the 
examination   of  any   and   all   elements   of   the   cost   of  raw 
material  disclose   any  possibility  of  reduction  of  cost  at  all 
corresponding   to   the  ftill   in    prices,   the   only   considerable 
saving — the  reduction  in  prices  of  merchandise — being  fully 
absorbed  by  the  advance  in  the  standard  of  life,  which  the 
farmer  seeks  to  share,  and  ought  to  share,  with  other  classes. 
All  agree,  however,  in  assigning  either  to  reduction  of  cost,  or 
appreciation  of  money,  the   reduction  of  prices;   since   it   is 
evidently   not   the   former,  it   must  be   the   latter;   but  it  is 
absurd   to   say,   and   nobody    will   say,  that   appreciation   of 
money  has  reduced  prices  of  agricultural  products,  and  not 
affected    prices  of  other   products.      Therefore   it   is   mainly 
appreciation  of  money  wliich   has  reduced  the  prices  of  all 
l)roducts.     The  remedy  is  therefore  the  depreciation  of  money 
by  increasing  its  volume,  not  by  fiat  or  irredeemable  paper 
money,  but  by  restoring  to  its  monetary  office  the  metal  which 
has  been  discarded  by  so  many  commercial  nations. 


THE  FARMER  AND  THE  CURRENCY.  370 

As  between  silver  and  gold,  the  diagrams  show  that  while 
silver  itself  has  appreciated  slightly  during  the  last  twenty- 
five  years,  it  is  shown  to  be  a  measure  of  value  far  more 
just  than  gold.  But  in  relation  to  agricultural  products  these 
tables  of  index  numbers  are  very  unfair  to  the  farmer,  for  the 
reason  that  the  index  numbers  of  agricultural  products  are 
based  on  prices  at  centers  of  consumption,  and  therefore 
include  cost  of  transportation,  which  is  the  only  element  in 
which  there  has  been  important  if  any  decrease  of  cost. 
Tables  in  which  the  index  numbers  should  be  based  on  farm 
costs  would  evidently  show  a  still  greater  appreciation  of 
money,  and  especial!}^  gold,  and  if  applied  to  ngricnltural 
products  alone  would  show  the  conditions  to  be  w^orse  than 
have  been  claimed. 

To  the  contention  that  all  existing  contracts  in  the  United 
States  are  based  upon  the  pledge  of  the  United  States  to  main- 
tain all  forms  of  currency  issued  by  it,  upon  a  par  with  each 
other  at  established  ratios,  it  may  be  replied  that  that  has 
nothing  to  do  wnth  equities  between  man  and  man  upon  which 
the  argument  for  free  silver  is  placed,  and  that,  as  a  matter  of 
fact,  the  consideration  has  never  entered  into  the  formation  of 
contracts;  the  fact  that  the  United  States  has  promised  to  and 
will  redeem  its  outstanding  silver  coinage  in  gold  at  sixteen  to 
one  may  or  may  not  involve  a  national  loss,  but  is  certainly 
no  reason  why  the  people  of  the  nation  should  forever  retain  gold 
as  its  standard  of  value.  It  is  conceded  that  remonetization 
of  silver  would  in  some  degree  raise  its  price,  so  that  even 
were  silver  remonetized,  and  upon  the  assumption  that  the 
monetary  standard  is  hereafter  to  be  silver,  the  farmer,  at  least, 
would  still  be  at  a  disadvantage.  The  decline  in  the  value  of 
silver  as  compared  with  gold  can  in  nowise  be  attributed  to 
increased  production,  which  has  not  been  anything  like  the 
decrease  in  price,  but  is  mainly  due  to  its  general  demonetiza- 
tion by  commercial  countries,  and  more  than  all  else  to  the 
fear  of  commercial  classes  everywhere  that  it  will  soon  be 
practically  abandoned  as  money.  The  remedy  is  speedy  and 
full  remonetization,  produced  by  such  a  display  of  voting 
strength  on  the  pait  of  the  classes  which  have  been  injured 


380  THE    QUESTIONS    OF    THE    DAY. 

as  shall  make  it  evident  that  silver  money  has  come  to  stay. 
It  has  fallen  in  price  from  a  lack  of  confidence.  Its  price 
must  be  restored  by  a  restoration  of  confidence.  To  set  gold 
as  the  permanent  standard  of  value  is  to  doom  all  the  indebted 
classes  to  slavery,  for  geology  teaches  us  that  the  supply  of 
gold  in  the  earth  is  limited,  and  mainly  near  the  surface,  and 
when  found  in  deeper  veins  its  extraction  becomes  excessively 
expensive,  so  that  with  the  rapid  exhaustion  of  the  placer 
deposits  now  going  on  throughout  the  world,  the  cost  and 
value  of  the  metal  will  rapidly  increase,  with  a  corresponding- 
increase  in  the  obligations  of  the  debtor  who  is  compelled  to 
obtain  it.  Silver  is  not  a  good  standard  of  deferred  payments  ; 
it  tends  to  appreciate,*  to  the  disadvantage  of  the  producers, 
whose  costs  are  stationary,  and  to  debtors  with  long-deferred 
payments;  there  is,  however,  some  reason  to  hope  that  by 
improved  processes  of  production,  under  the  stimulus  of  better 
demand,  its  production  may  be  so  increased  as  to  in  some 
measure  relieve  this  injustice.  At  any  rate,  it  is  a  better 
standard  than  gold,  and  some  approach  towards  justice  is  at 
present  all  that  anybody  is  demanding. 

II.  It  is  expedient.  Justice  is  always  expedient.  The 
standard  of  {)ayment  should  not  be  that  money  which  is  most 
used  in  large  transactions,  but  that  which  is  most  largely 
diffused  among  the  people  of  the  earth,  which  is  the  most 
bulky  and  unwieldy,  and  therefore  moves  about  less  freely 
and  is  less  subject  to  local  and  even  general  influences.  There 
will  always  be  gold  enough  to  pay  cash  balances  between 
nations  after  offsets  of  credits  have  been  balanced.  Let  it  be 
used  for  that  on  the  basis  of  its  commercial  value  as  compared 
with  silver,  which  is  the  proper  standard.  The  notion  that 
there  will  be  occasion  for  the  expensive  transportation  of 
silver  on  a  largo  scale  is  a  myth.  The  proper  place  for  silver 
is  in  the  hands  of  people  for  daily  use,  to  the  extent  to  whicli 
tliat  can  be  stimulated  by  the  withdrawal  of  i)aper  money  of 
small  denominations,  and  for  the  rest  in  banks  and  national 


*  There  are  no  adequate  data  for  determininc:  this  question  of  fact.      See 
Appendix  G,  for  all  there  is  upon  this  subject. 


TJIE    FAKMKR    AND    THE    CURRENCY  381 

vaults,  from  which  it  is  represented  by  paper.  Of  course  it 
will  cost  more  to  build  vaults  for  that  purpose  thau  to  build 
them  to  hold  only  one-sixteenth  or  one-twenlieth  of  the  bulk, 
but  in  consideration  of  the  end  to  be  gained,  the  cost  is  not 
serious  enough  even  to  be  spoken  of. 

As  to  the  calamities  which  are  predicted  during  the  season 
of  transition,  they  are  doubtless  overdrawn  in  the  arguments 
of  the  gold  monometalists;  but  something  of  the  kind  would 
happen;  there  would  be  a  scramble  for  gold  as  stated  ;  there 
would  be  pressure  to  collect  debts;  production  would  diminish, 
and  men  be  thrown  out  of  employment;  tlie  rise  of  prices 
would  not  come  at  once,  and  would  be  preceded  by  a  spasm  of 
severe  contraction-;  there  would  be  much  suffering  and  some 
bankruptcy  among  those  who  might  apparently  escape  if 
things  remain  as  they  now  are.  But  it  would  not  be  so  serious 
as  anticipated;  men  have  been  preparing  for  it  too  long;  too 
many  liquidations  have  already  taken  place;  he  that  is  down 
needs  fear  no  fall;  there  could  never  be  so  good  a  time  as  now 
to  make  the  plunge;  still  there  would  be  trouble;  for  this  we 
are  sorry;  we  would  avoid  it  if  we  could  and  still  be  just;  but 
it  is  an  awful  fact  that  no  great  injustice  can  ever  be  remedied 
without  great  suffering,  and  the  suffering  does  not  always  fall 
on  those  who  have  sinned;  it  falls  upon  those  who  are  in  the 
way.  The  abolition  of  slavery  brought  woe  to  multitudes  who 
were  innocent  of  slavery.  The  return  to  an  honest  measure  of 
value  will  bring  distress  to  many  who  liave  never  profited  by 
a  dishonest  measure  This  can  not  be  helped;  we  must  endure 
it  as  we  may;  it  will  not  last  long,  and  in  the  end  the  recom- 
pense will  come,  if  not  to  those  who  have  most  suffered,  to  the 
country  at  large.  We  shall  be  doing  business  honestly,  at  least 
as  honestly  as  seems  humanly  possible;  prices  once  more  will 
be  on  a  normal  basis,  and  will  proceed  with  the  ordinary 
minor  fluctuations  which  mankind  have  hitherto  endured 
without  complaint.     We  want  an  honest  dollar. 

The  foregoing  is  the  argument  for  free  coinage  in  the  form 
which  appeals  most  strongly  to  me.  It  is  quite  evident  that 
there  is  something  to  be  said  on  both  sides  of  the  question. 
To  shirk  difficulties  or  deny  facts  is  trivial  and  unworthy  and 


382  THE    QUESTIONS   OF    THE    DAY. 

does  not  tend  to  the  settlement  of  questions  so  that  they  will 
stay  settled.  Mankind  learns  daily,  and  in  the  end  the  truth 
will  prevail. 

I  have  not  included,  in  the  discussion,  any  opinions  as  to 
the  acts  of  other  nations  in  case  of  our  adoption  of  free 
coinage.  Some  insist  that  other  nations  will  be  forced  to 
follow  our  example  in  remonetizing  silver;  others  insist  as 
strongly  that  our  fiscal  affairs  will  be  permanently  sepa- 
rated from  other  commercial  nations.  As  a  matter  of  fact, 
neither  party  knows  what  would  happen.  All  nations  will  be 
guided  by  the  opinion  of  the  ruling  majority  for  the  time  being 
as  to  their  interests.  These  opinions  are  liable  to  change  with 
the  march  of  events.  Of  course,  should  other  nations  remon- 
etize  silver,  its  value  would  tend  to  rise,  and  prices  to  corre- 
spondingly fall. 

From  all  the  foregoing,  with  a  study  of  the  tables  which 
appear  in  the  appendix,  and  of  such  official  documents  and 
standard  works  upon  economics  as  are  available,  the  reader 
must  form  his  own  judgment.  In  so  doing  one  of  the  first 
things  to  do  is  to  form  an  opinion  as  to  the  facts  in  which 
the  two  arguments  do  not  agree.  Especially,  does  the  variation 
of  prices  which  has  occurred  indicate  appreciation  of  money 
or  reduction  of  costs?  If  both,  what  is  the  relative  influence 
of  each?  An  intelligent,  independent  opinion  on  this  point 
involves  a  careful  study  of  conditions  surrounding  the  student, 
and  a  patient  study  of  detailed  data  collected  by  economists. 
The  matter  can  not  be  further  elucidated  here.  It  would 
require  a  volume.  A  definite  opinion  on  this  point  should  be 
conclusive  as  to  the  equities  of  the  case. 

It  is,  however,  necessary  to  caution  the  student  against 
placing  much  reliance  on  the  deliverances  of  the  political 
press,  or  controversial  pamphlets  or  books.  Least  of  all 
should  we  be  influenced  by  the  utterances  of  political  orators. 
The  first  object  of  a  political  paper  or  speaker  is  to  uphold  its 
party  and  elect  its  candidates.  Economic  discussion  at  such 
times  is  always  superficial.  Things  which  make  for  the 
support  of  tlie  view  which  is  favored  are  magnified;  those 
which  make  for  opposing  views  are   belittled  or  suppressed. 


THE  FARMER  AND  THK  CURREN'CY.  383 

The  object  is  not  to  find  truth,  but  to  get  votes.  The  writers 
or  speakers  may  be,  and  probably  usually  are,  perfectly  honest 
in  their  views.  It  is  easy  to  get  strong  convictions  by  the 
exclusive  study  of  one  side.  The  way  to  find  truth  is  to 
impartially  study  all  sides,  shirking  no  facts  which  may  be 
disagreeable.  The  caution  here  given  applies  to  all  parties, 
and,  I  am  sorry  to  say,  on  this  particular  subject,  to  nearly 
all  literature. 


CHAPTER  V. 

THE  FARMER  AND  THE  LABOR  QUESTION. 

THE  farmer  does  not  sell  his  labor,  but  the  products 
thereof.  He  is  largely  an  employer  of  labor,  hoping 
by  the  sale  of  the  'product  thus  obtained  to  make  a 
profit.  The  "laborer" — especially  the  skilled  laborer — sells 
his  labor  direct  to  capitalists,  who  hope  to  sell  the  resulting 
product  at  a  profit.  With  the  money  obtained  from  the  capi- 
talist from  the  sale  of  his  labor,  the  laborer  buys  produce  from 
the  farmer.  Economically,  therefore,  the  relation  of  the  farmer 
to  the  laborer  is  that  of  either  a  buyer  of  labor  or  a  seller  of 
produce.  It  is  to  the  farmer's  interest  to  have  labor  cheap 
and  produce  dear.  It  is  to  the  interest  of  the  laborer  that 
produce  shall  be  cheap  and  labor  dear.  Nothing  can  change 
these  conditions  so  long  as  men  are  deemed  entitled  to  the 
products  of  their  own  labor  and  land,  and  permitted  to  buy 
and  sell  as  they  may  agree  with  each  other. 

It  does  not  follow  that  this  economic  antagonism  should 
produce  enmity.  All  classes  are  in  economic  antagonism 
with  all  other  classes,  and  must  remain  so  while  men  compete 
with  each  other,  and  yet  upon  the  whole  they  get  on  together, 
because  at  the  bottom  they  have  an  identical  interest  in  the 
fact  that  each  has  a  surplus  of  what  some  other  lacks.  Their 
mutual  necessity  to  trade  together  is  the  bond  which  unites 
all  classes,  and  should  prevent  economic  differences  from 
culminating  in  mutual  hate.  As  between  individuals  brought 
into  personal  contact,  hostility  does  not  ordinarily  result  from 
trading.  Occasionally  it  does,  but  friendship  results  quite  as 
often.  As  between  classes  whose  members  do  not  mingle 
freely  with  those  of  other  classes  there  is  more  danger.  If 
one  class,  upon  the  average,  is  prosperous,  and  the  otlier,  upon 
the  whole,  unfortunate,  enmity  is  quite  certain  to  rei=nlt.  In 
this  lies  the  danger  to   modern   society,  to   be   escaped   only 

(384) 


THE    FARMER    AND    THE    LABOR    QUESTION.  385 

by  mutual  forbearance,  and   mediation  or  repression  by  the 
consolidated  social  force. 

Between  the  farmers  and  the  laboring  classes  there  is  a 
certain  bond  of  union  in  the  fact  that  both  conceive  them- 
selves to  be  suffering  from  the  oppression  of  consolidated 
wealth.  The  most  discontented  farmers  and  tlie  most  discon- 
tented laborers  are  at  times  quite  inclined  to  unite  for  political 
action.  This  tendency  is  promoted  by  the  fact  that  betw^een 
tiie  farmers  and  the  workingmen  there  is  a  buffer  class  of 
tradesmen,  which  im])artially  receives  the  kicks  which  the  two 
chesses  would  bestow  upon  each  other  if  they  dealt  directly. 
At  the  same  time  farmers  belong  logically  with  capitalists  and 
employers  (or  exploiters),  and  as  attached  to  the  private  owner- 
ship of  land,  mi*st  oppose  one  of  the  fundamental  dogmas  of 
a  large  body  of  wa>rkingmen. 

Before  considering  the  relations  of  the  farmers  to  the  labor 
question  it  is  necessary,  if  we  can,  to  define  the  labor  question. 
This  is  not  easy  to  do,  because  workingmen  do  not  agree  in 
their  demands.  We  are  compelled  to  deal  only  with  the 
demands  of  organized  labor,  because  those  only  are  formu- 
lated. Organized  labor,  however,  is  a  minority  of  labor,  and 
the  quarrels  between  labor  factions,  like  other  civil  wars,  are 
more  bitter  than  the  contests  with  outsiders.  As  I  write  I 
have  before  me  a  copy  of  a  weekly  paper  which  is  the  organ 
of  one  branch  of  workingmen  which  denounces  the  national 
leader  of  another  branch  in  terms  of  positive  ferocity.  I 
imagine  that  both  the  writer  and  tlie  person  attacked  are 
honest  men  carried  away  by  one-sided  views  of  the  ills  of 
society. 

Trade  unionism  seeks  to  incorporate  in  "unions"  of  the 
different  trades  all  workers  therein,  and  to  prevent  the  employ- 
ment in  that  trade  of  any  person  not  a  member  of  the  union. 
At  the  same  time  it  seeks  to  limit  the  number  of  workmen  in 
the  trade,  by  fixing  the  number  of  apprentices  in  each  shop 
at  a  fixed  ratio  to  the  total  number  of  employees.  At  times 
and  places  where  the  unions  are  strong  enough  these  rules 
are  strictly  enforced.  Without  the  consent  of  the  union  an 
employer  may  not  put  his  own  son  to  work  in  the  shop.  The 
25 


386  THE   QUESTIONS    OF    THE    DAY. 

hours  of  labor  to  constitute  a  day's  work  are  fixed  with  refer- 
ence to  giving  employment  to  tlie  largest  number  possible- 
At  first,  in  this  country,  the  day's  work  was  ten  hours,  then 
nine;  now  all  trades  are  striving  for  an  eight-hour  day, 
and  some  have  achieved  it.  In  case  of  disagreement  with 
employers  the  ultimate  remedy  is  a  strike.  The  unions  claim 
to,  and  probably  do  in  most  cases,  include  the  best  workmen 
in  their  respective  trades.  In  most  cases,  however,  the  places 
of  strikers  can  be  promptly  filled  by  other  workmen  who  are 
out  of  employment.  The  new  men,  however,  are  seldom  so 
efficient  as  the  old,  and  strikes  in  large  establishments,  and 
especially  when  important  work  is  pressing,  cause  great  loss 
to  employers.  In  some  trades,  as  locomotive  engineers,  for 
example,  an  extensive  strike  may  almost  paralyze  trade,  since 
there  are  almost  never  at  hand  skilled  engineers,  who  can 
safely  operate  a  locomotive,  in  sufficient  number  to  run  trains. 
When  strikes  are  organized  on  a  large  scale,  and  the  result  is 
doubtful,  effbrts  are  made  to  induce  "sympathetic  strikes,"  in 
trades  more  or  less  closely  connected  with  the  strikers,  but 
who  have  at  the  time  no  grievance  of  their  own.  This  adds 
to  the  embarrassment  of  the  employers,  and  by  interesting  a 
larger  number  of  people,  increases  the  pressure  of  public 
opinion.  For  example,  if  locomotive  engineers  were  on  a 
strike,  they  would  seek  to  enlist  the  fireman's  organization, 
or  that  of  the  trainmen,  in  the  hope  of  absolutely  stopping- 
transportation.  This  would  tend  to  bring  the  public  to  the 
side  of  the  strikers,  because  it  would  desire  business  to  be 
resumed  and  travel  made  safe,  with  little  regard  to  the  interest 
of  contending  parties;  and  as  the  railroads  can  usually  be 
coerced  easier  and  quicker  than  the  strikers,  the  pressure  tends 
to  be  put  on  them  to  yield. 

It  has  come  to  be  generally  conceded  that  a  strike  is  a  legit- 
imate and  proper  method  of  procedure  iu  case  of  extremity, 
provided  it  be  conducted  peacefully.  No  one  questions  the 
right  of  any  person  to  stop  work  when  he  does  not  wish  to 
work  longer,  and  very  few  now  question  the  right  of  organized 
bodies  of  workingmen  to  stop  simultaneously  by  virtue  of  a 
prearranged  agreement.     Early  in  the  history  of  trade  union- 


THE    FAIIMKR    AND    THK    [,AI?()K,    (iUKSTION.  387 

ism  this  was  not  the  case.  A  "conspiracy"  to  injure  one  in 
his  business  is  now,  and  always  has  been,  a  penal  offense,*  and 
in  the  early  days  of  labor  organization  in  Great  Britain  the 
conspiracy  laws  were  invoked  and  applied  with  great  severity 
to  members  of  trade  unions.  It  is  now  conceded  that  action 
by  an  organized  trade  union  is  not  a  conspiracy  within  the 
meaning  of  the  law.  A  notable  exception  was  in  the  case  of 
the  great  railroad  strike  of  1894,  when  a  United  States  judge 
enjoined  certain  labor  leaders  from ''conspiring"  to  interrupt 
the  transportation  of  trains  carrying  the  United  States  mails 
and  also  certain  employees  from  quitting  work  without  notice, 
when  interruption  of  the  passage  of  mails  would  result.  This, 
however,  was  not  approved  by  public  sentiment,  and  no  sim- 
ilar instance  is  likely  to  occur.  The  right  to  engage  in  a 
peaceful  strike  may  be  considered  settled. 

The  trouble  is  that  great  strikes  are  never  conducted  peace- 
fully. They  are  almost  certain  to  result  in  riots,  destruction 
of  property,  and  murder.  When  strikes  occur  there  is  always 
a  rush  of  the  unemployed  to  obtain  the  vacated  positions,  and, 
as  a  rule,  a  strictly  peaceful  strike  would  simply  result  in  a 
change  of  workmen,  those  who  were  formerly  employed  chang- 
ing places  with  those  who  were  not.  Work  would  go  on  with 
more  or  less  hindrance  and  loss  for  a  time,  and  finally  resume 
its  normal  condition.  This  is  perfectly  understood  by  the 
workmen,  who,  upon  the  occurrence  of  the  strike,  congregate 
about  the  place  where  they  were  employed,  entering  it  if  per- 
mitted, and  by  all  means  in  their  power  seeking  to  dissuade 
others  from  taking  their  places.  The  persuasion  is  backed  up 
by  a  strong  display  of  force,  and  if  unsuccessful  is  followed  by 
insults  and  abuse.  The  thugs  and  thieves  always  join  them- 
selves to  the  strikers,  in  the  hope  of  a  resulting  tumult  in 
which  they  may  ply  their  trade.  The  new  workmen  can  only 
reach  or  leave  their  employment  under  police  protection,  and 


*This  chapter  can  not  deal  with  the  history  of  the  organization  of  labor,  or 
even  its  present  condition  or  the  ethics  of  the  subject.  It  must  be  confined  to 
an  elucidation  of  the  topics  which  imay  involve  political  controversj'^,  and  the 
relation  of  the  farmers  thereto. 


3S8  THE    QUESTIONS    OF    THE    DAY. 

are  assaulted  whenever  tliey  are  caught  alone.  The  property 
of  the  offending  company  is  injured  and  destroyed  so  far  as 
possible.     Riots  may  follow  and  the  military  be  called  out. 

For  all  these  disturbances  the  unions  invariably  disclaim 
responsibility,  stating  them  to  be  tlie  work  of  sympathizers 
whom  they  can  not  control.  This  is  sometimes  literally  true 
and  sometimes  not.  It  is  always  disingenuous,  however,  to 
disavow  responsibility,  for  tumult  is  known  to  be  an  almost 
certain  result  of  a  large  strike  followed  by  even  peaceful  dem- 
onstrations against  new  workmen.  In  most  cases  it  is  only 
by  intimidation  of  persons  and  destruction  of  property  com- 
mitted by  somebody  that  strikers  can  hope  to  win,  and  they 
count  on  them  accordingly.  Nobody  claims  that  strikers  will 
be  molested  if  they  do  not  provoke  attack  by  insult  or  worse, 
and  the  quibble  of  disclaiming  responsibility  for  riot,  even 
where  not  actually  engaged  in  it,  is  discreditable. 

When  such  conditions  arise  it  is  the  first  duty  of  society  to 
preserve  order.  Those  seeking  work  have  the  right  to  be 
protected,  even  from  intimidation  and  insult,  and  owners  of 
property  have  a  right  to  its  protection.  With  the  original 
cause  of  quarrel  it  may  or  may  not  be  desirable  that  society 
should  concern  itself.  As  to  the  duty  of  society  to  preserve 
order  under  all  circumstances,  there  can  be  no  question 
whatever. 

The  concrete  questions  which  arise  out  of  this  condition  of 
things,  and  which  tend  to  become  the  subject  of  political  action, 
are  substantially  as  follows: — 

It  is  demanded  that  the  state  make  and  enforce  a  short-day 
law — eight  hours  being  the  length  usually  demanded — forbid- 
ding all  contracts  for  payment  by  the  hour,  or  for  days  to 
exceed  eight  hours;  that  the  state  itself  shall  set  the  example, 
by  making  its  days  of  work  eight  hours  long,  and  prohibiting 
the  performance  of  public  work  by  contract,  unless  the  con- 
tractors bind  themselves  to  the  eight-hour  day. 

This  involves  a  number  of  things.  In  the  first  place,  there 
is  the  question  whether  the  state  should  pay  more  for  its  labor 
than  individuals  jiay.  Doubtless  it  does  pay  more  if  it,  at 
present,  makes  eight  hours  a  day's  work  in  all  departments. 


THE    FARMER    AND   THE   LABOR   QUESTION.  389 

As  a  proposition  by  itself  this  can  not  be  sustained  except 
upon  the  supposition  that  eight  hours  is  a  proper  clay's  work 
and  the  sum  paid  for  such  a  day  a  fair  price.  As  a  matter  of 
fact,  what  is  demanded  is  that  the  state  shall  pay  for  eight 
hours  at  least  as  much  as  individuals  pay  for  a  longer  day. 
Another  matter  to  be  considered  is  the  logical  effect  of  making 
an  eight-hour  day  for  all  workingmen,  "All"  workingmen 
include  the  employees  of  farmers.  As  farming  life  goes,  eight- 
hour  days  are  impracticable.  The  work  must  contiime  longer, 
and  I  do  not  think  ftirmers  would  be  satisfied  to  continue 
work  for  three  or  four  hours  while  the  employee  smoked  his 
pipe  and  looked  on.  And  yet  it  is  difficult  to  see  how  the 
state  can  discriminate  in  favor  of  one  class  of  workmen  and 
against  another.  It  is  difficult  to  see,  but  not  impossible.  As 
a  matter  of  fact,  the  state  can  do,  and  ought  to  do,  what  is  for 
the  general  good  of  society,  and  if  that  should  be  seen  to 
involve  an  eight-hour  day  for  one  class  and  a  twelve-hour  day 
for  another,  that  ought  to  be  the  law. 

The  question  then  arises  whether  it  is  just  that  the  farmer 
work  twelve  hours — as  he  must — while  the  artisan  works 
eight,  and  especially  that  the  farmer  should  aid  to  pass  laws 
for  securing  to  the  artisan  that  advantage  which  he  is  not  able 
to  obtain  by  unaided  efforts.  It  is  also  ^  question  how  much 
workingmen  can  be  helped  by  the  eight-hour  day.  In  the 
end,  unless  society  comes  to  the  aid  of  the  artisan,  the  result 
must  be  a  lowering  of  wages,  but  the  advantage  will  doubtless 
be  gained  of  a  wider  distribution  of  wages.  These  are  ques- 
tions which  must  be  settled  after  more  profound  study  than 
can  be  given  here,  upon  the  principle  of  doing  that  which  is 
best  for  society.  There  can  be  no  question  of  the  deplorable 
condition  of  a  large  fraction  of  humanity,  or  of  the  economic 
wisdom,  saying  nothing  of  the  moral  obligation,  of  affording 
relief  At  first  thought  the  interests  of  the  farmer  would  seem 
to  lie  in  the  direction  of  opposition  to  the  eight-hour  day  and 
permitting  the  full  operation  of  the  law  of  competition  among 
workingmen,  and  between  them  and  their  employers,  but  I 
am  not  at  all  sure  that  that  would  be  the  conviction  after 
final  thought. 


390  TIFF.    QUESTIONS    oF    THE    DAY. 

It  is  demanded  that  the  state  make  and  enforce  a  compul- 
sory arbitration  law  for  the  settlement  of  disputes  between 
workmen  and  employers.  To  this  it  is  objected,  on  tlie  one 
hand,  that  it  is  a  violation  of  the  freedom  of  contract,  a  matter 
which  has  already  been  considered  in  reference  to  the  eight- 
hour  day.  A  more  definite  objection  is  tiie  claim  that  arbi- 
tration might  result  in  awards  which  the  employer  could  not 
comply  with  without  ruin,  and  which,  yet,  could  be  enforced 
against  him,  since  he  has  property,  while  an  award  distasteful 
to  the  workmen  could  not  be  enforced,  since  they  can  not  be 
forced  to  labor  against  their  will.  In  regard  to  this,  public 
sentiment  seems  to  be  crystallizing  in  favor  of  official  arbitra- 
tion which  shall  not  be  compulsory.  This  involves  the  crea- 
tion, as  disputes  may  arise,  of  official  boards  of  arbitration, 
whose  proceedings  shall  be  official  records,  and  which  shall,  in 
cases  of  dispute,  clearly  formulate  the  issues,  hear  the  evi- 
dence, and  render  a  decision,  relying  for  the  enforcement  of 
the  decisions  on  the  good  sense  and  self-interest  of  the  con- 
tending parties  and  the  power  of  public  opinion.  It  is 
believed  that  either  side,  which,  after  a  fair  arbitration,  should 
refuse  to  accept  the  verdict,  would  be  unable  to  sustain  itself 
against  the  overwhelming  force  of  public  sentiment.  In  my 
judgment  this  is  emii^ntly  wise  and  desirable.  The  mere 
official  formulation  of  the  questions  at  issue,  with  an  abstract 
of  the  evidence  on  disputed  points  of  fact,  would  place  the 
public  itself  in  the  position  of  an  arbitrator,  and  might 
usually  be  relied  on  to  assure  a  just  settlement,  even  without 
the  decision  of  a  board.  I  believe  farmers  should  favor  such 
legislation  by  all  means  in  their  powei".  This  i)resupposes 
that  both  sides  to  a  controversy  shall  in  advance  commit 
themselves  in  writing  to  abide  by  the  decision  of  the  arbi- 
trators. Should  either  party  refuse  this,  I  believe  it  would  be 
wise  to  arrange  for  a  clear  formulation  of  the  issues  by  the 
board,  the  presentation  of  the  testimony  upon  the  side  which 
is  willing  to  arbitrate,  a  statement  of  the  lacts  u[)on  the  other 
side  according  to  the  best  information  of  the  arbitrators,  and 
their  conclusions  in  the  light  of  all  they  have  been  able  to 
learn.  In  such  cases  I  believe  that  public  opinion  would 
soon  force  a  settlement. 


THE    FAKMFJl    AND    THE    LABOR    QUESTION.  391 

It  is  demanded  that  the  military  shall  not  be  employed 
against  strikers,  but  that  the  task  of  preserving  order  shall  be 
left  to  the  regular  police.  It  is  especially  demanded  that 
private  police  should  not  be  employed.  As  to  the  last  it  is 
certainly  necessary  that  life  and  property  be  protected.  If  the 
state  will  supply  the  jirotection,  no  employer  will  wish  to  pay 
for  it.  But  it  is  notorious  that  the  police  force  of  most  cities 
is  totally  inadequate  to  preserve  order  in  times  of  great  excite- 
ment, and  it  is  unreasonable  to  expect  the  public  to  maintain, 
during  ordinary  times,  a  police  force  capable  of  preserving 
order  in  great  emergencies.  It  is  notorious  that  a  portion  of 
the  police  in  all  cities  is  closely  connected  by  many  ties  to  the 
workingmen  of  the  city,  and  will  act  against  them  with  great 
reluctance.  When  the  workmen  therefore  demand  that  no 
aid  be  given  to  the  })olice  in  maintaining  order  in  times  of 
great  strikes,  they  are  disingenuous.  In  a  great  strike  they 
know  there  may  be  riots.  When  they  say  they  are  not 
responsible  for  these,  and  disfavor  them,  and  yet  object  to  the 
use  of  tlie  only  means  which  can  control  them,  they  show  a 
real  sympathy  which  they  are  unwilling  to  avow.  Neither 
the  military  or  private  police  have  ever  yet  been  employed  in 
this  country  to  molest  any  citizen  who  was  attending  to  his 
own  business,  and  letting  other  people  alone.  They  are  never 
likely  to  be.  Nobody  who  is  doing  right  is  in  any  danger  of 
molestation.  In  times  of  riot  the  first  duty  to  society  is  the 
restoration  of  order,  kindly,  if  possible;  roughly,  if  necessary; 
immediately,  at  all  costs.  The  merits  of  the  dispute  have 
nothing  to  do  with  the  case.  There  will  be  time  to  attend  to 
them  later.  Those  who  complain  of  the  use  of  soldiers  are 
those  who  intend  to  break  the  law.  They  deserve  no  sym- 
pathy, and  if  they  persist  in  violent  actions,  no  mercy.  The 
security  of  the  whole  people  is  the  first  consideration,  and  the 
really  merciful  commander  is  one  who  hesitates  at  no  neces- 
sary severity  to  restore  order  promptly  when  occasion  requires 
it.  No  one  will  be  endangered  who  does  not  interfere  with 
others.  There  is  a  rough  element  in  society  which  can  be 
safely  dealt  with  only  by  rough  methods. 

The  above  are  the  principal  demands  of  the  trade-union 


392  THE    QUESTIONS    OF    THE    DAY. 

section  of  workinginen,  so  far  as  they  are  subjects  of  political 
action.  In  addition  there  are  some  complaints,  which  have 
not  been  made  the  basis  of  regular  demands.  Among  these 
one  of  the  most  common  is  an  allegation  that  the  judiciary  of 
the  country  are  in  sympathy  with  the  capitalist  classes  to  the 
extent  that  justice  can  not  be  had  of  them  for  others.  This  is 
not  true,  for  judiciary  is  not  corrupt,  nor  is  it  biased;  or  if  it 
is  biased  in  any  instance,  it  is  almost  invariably  in  behalf  of 
tiie  weak.  The  statement  that  great  cooperations  usually  win 
their  cases  is  doubtless  true,  for  they  act  under  the  advice  of 
great  lawyers,  and  in  ordinary  cases  are  within  the  law  in  all 
their  acts.  If  they  win  when  they  should  not  in  equity,  the 
remedy  is  in  a  change  of  the  law,  and  not  in  an  abuse  of  the 
judiciary,  who  simply  declare  the  law  as  they  find  it.  The 
judiciary  and  the  military  are  the  bulwarks  of  all  honest  men 
against  the  violent  and  the  crafty.  Under  no  circumstances 
should  the  independence  of  the  judiciary  be  impaired.  A 
mob  is  far  more  likely  to  intimidate  a  judge  than  a  capitalist 
to  corrupt  him.  That  justice  is  unreasonably  delayed  and 
extravagantly  costly  in  most  civilized  countries  is  unquestion- 
ably true.  That  the  fault  lies  largely  with  the  judges  is  also 
true,  for  they  have  failed  to  withstand  if  they  have  not  actu- 
ally encouraged  the  tendency  to  employ  legal  refinements  to 
the  delay  or  the  perversion  of  justice.  And  yet  all  those  legal 
"refinements"  which  stand  the  analysis  of  the  higher  courts, 
and  finally  become  incorporated  in  the  body  of  judge-made 
law,  are  founded  on  sound  principles  and  a  correct  under- 
standing of  statute  law  as  it  exists.  The  expression  ''judge- 
made  law"  has  come  to  be  a  term  of  reproach.  It  is  frequently 
used  as  such  among  farmers.  This  is  wrong.  Judges  can  not 
help  making  law.  When  counsel  raises  a  point  as  a  necessary 
inference  from  undoubted  statute  law,  the  judge  must  decide 
it.  He  can  not  put  it  aside.  When  he  has  decided  it,  and 
the  decision  is  sustained  by  the  highest  courts,  it  becomes 
judge-made  law — that  is,  it  is  found  to  be  law,  upon  examina- 
tion, by  virtue  of  its  necessarily  following  from  a  proper 
interpretation  of  statute  law,  although  the  authors  of  the 
statute  may  have   never  thought  of  it.     The  ignorance  and 


THE    FARMER    AND    THE    LABOR    QUESTION.  393 

bad  English  of  many  of  our  legislators  are  responsible  for  a 
great  part  of  the  judge-made  law  of  America.  When  a  law  is 
invoked  before  a  judge  he  is  compelled  to  do  something  with 
it,  and  when  he  tries  to  unravel  its  meaning,  he  often  has  a 
very  hard  time.  If  he  can  attach  any  reasonable  meaning  to 
its  words,  he  is  bound  to  do  so,  and  very  often  the  language  of 
tlie  act  compels  him  to  decide  that  the  law  is  very  different 
from  what  it  was  intended  to  be,  of  which  fact  the  judge  can 
take  no  notice.  He  must  read  the  law  as  it  is,  and  not  as  he 
may  suppose  it  was  intended  to  be. 

The  remedy  for  the  injustice  which  is  wrought  in  the 
courts  under  the  forms  of  law,  is  in  forbidding  appeals  or 
writs  of  error  except  upon  the  certificate  of  the  judge  that 
substantial  justice  has  not  been  done,  and  the  disallowance  of 
postponement  except  upon  those  serious  occasions  which 
seldom  happen.  Let  the  facts  be  brought  out  when  fresh  and 
a  verdict  given  upon  them,  and  then  let  it  stop.  It  will  be 
better  for  litigants  and  far  better  for  the  community. 

This  subject  is  germane  to  the  labor  question,  for  the  reason 
that  labor  agitators  attack  our  courts  more  viciou.sl}^  than  any 
other  class.  The  farmers  should  sustain  the  courts,  and  if  they 
do  not  like  the  decisions,  should  change  the  law. 

Thus  far  I  have  considered  the  demands  only  of  the  trade 
union  wing  of  the  workingmen.  The  views  of  the  unorganized 
majority  we  do  not  know.  But  there  is  another  wing,  quite 
small  in  organized  members,  but  filled  with  determination. 
The  Socialist  Labor  party  is  composed  of  Socialists,  who  see 
in  the  demands  of  the  trade  unions  nothing  worth  agitating 
for  except  as  a  very  short  step  towards  something  else.  Social- 
ism is  increasing  its  votaries  in  America,  as  elsewhere  in  the 
world.  It  is  not  likely,  within  any  future  that  we  can  fore- 
cast, to  be  even  a  very  powerful  minority  in  this  country,  but 
as  its  strength  will  be  concentrated  in  cities  and  be  supported 
not  only  by  its  own  honest  membership,  but  by  most  of  the 
bad  elements  of  society  which  favor  any  destructive  proposals, 
its  apparent  strength  will  be  greater  than  its  actual  strength. 

In  brief,  the  demands  of  the  Socialist  Labor  party  are  as 
follows,  in  the  language  of  a  late  national  platform  of  the 
party  :— 


394  THE    QUESTIONS    OF    THE    DAY. 

"1.  Reduction  in  tlie  liours  of  labor  in  proportion  to  tlie 
progress  of  production. 

"  2.  The  United  States  to  obtain  possession  of  the  mines, 
railroads,  canals,  telegraphs,  telepliones,  and  all  other  means 
of  public  transportation  and  communication ;  the  employees 
to  operate  the  same  cooperatively  under  control  of  the  Federal 
government  and  to  elect  their  own  superior  officers,  but  no 
employee  shall  be  discharged  for  j^olitical  reasons. 

"3.  The  municipalities  to  obtain  possession  of  the  local 
railroads,  ferries,  water  works,  gas  works,  electric  plants,  and 
all  industries  requiring  municipal  franchises;  the  employees 
to  operate  the  same  cooperatively  under  the  control  of  the 
municipal  administration,  and  to  elect  their  own  superior 
officers,  but  no  employee  shall  be  discharged  for  political 
reasons. 

"4.  Tlie  public  lands  to  be  declared  inalienable,  revocation 
of  all  land  grants  to  corporations  or  individuals,  the  condi- 
tions of  which  have  not  been  complied  with. 

"5.  The  United  States  to  have  the  exclusive  right  to  issue 
money. 

"6.  Congressional  legislation  providing  for  the  scientific 
management  of  forests  and  waterways,  and  prohibiting  the 
waste  of  the  natural  resources  of  the  country. 

"7.  Inventions  to  be  free  to  all;  the  inventors  to  be  remun- 
erated by  the  nation. 

"  8.  Progressive  income  tax  and  tax  on  inheritances;  the 
smaller  incomes  to  be  exempt. 

"9.  School  education  of  all  children  under  fourteen  years 
of  age  to  be  compulsory,  gratuitous,  and  accessible  to  all 
by  public  assistance  in  meals,  clothing,  books,  etc.,  wliere 
necessary. 

"10.  Repeal  of  all  jmuper,  tramp,  conspiracy,  and  sumj)- 
tuary  laws.     Unabridged  right  of  combination. 

"11.  Prohibition  of  the  employment  of  children  of  school 
age  and  the  employment  of  female  labor  in  occupations  detri- 
mental to  health  or  morality.  Abolition  of  the  convict  labor 
contract  system. 

"12.  Employment  of  the  unemployed  by  the  public  author- 
ities (county,  city,  state,  and  nation). 

"13.  All  wages  to  be  paid  in  lawful  money  of  the  United 
States.  Equalization  of  woman's  wages  with  those  of  men 
where  equal  service  is  performed. 

"14.  Laws  for  the  protection  of  life  and  limb  in  all  occupa- 
tions, and  an  efficient  employers'  liability  law. 

"  15.  The  people  to  have  the  right  to  propose  laws  and  to 


THE    FARMER    AND    THE    LABOR    QUESTION.  395 

vote   upon   all    measures   of    importanGe,   according    to    the 
referendum  principle. 

"16.  Abolition  of  the  veto  power  of  the  executive  (national, 
state,  and  municipal),  wherever  it  exists. 

"17.  Abolition  of  the  United  States  Senate  and  all  upper 
legislative  chambers. 

"18.  Municipal  self-government. 

"  19.  Direct  vote  and  secret  ballots  in  all  elections.  Uni- 
versal and  equal  right  of  suffrage  without  regard  to  color,  creed, 
or  sex.  Election  days  to  be  legal  holidays.  The  principle  of 
proportional  re{)resentation  to  be  introduced. 

"  20.  All  public  officers  to  be  subject  to  recall  by  their 
respective  constituencies. 

"21.  Uniform  civil  and  criminal  law  throughout  tlie 
United  States.  Administration  of  justice  to  be  free  of  charge. 
Abolition  of  capital  punishment." 

This  statement  of  principles  is  not  Socialism,  but  bears 
evidence  of  being  a  carefully-considered  combination  of 
•'[)lanks,"  calculated  to  catch  everybody  who  is  discontented 
with  anything.  Sucli  of  the  demands  as  I  desire  to  discuss 
are  dealt  with  elsewhere.  Those  who  hold  these  views  have 
hardly  the  right  to  call  themselves  Socialists,  although  the 
l)latform  includes  many  of  the  demands  of  Socialism.*  In  the 
main  the  Socialist  Labor  party  represents  the  violent  and 
revolutionary  wing  of  the  Socialists.  Its  declarations  and 
sometimes  its  acts  have  created,  among  law-abiding  men,  a 
prejudice  against  the  name  of  "Socialism"  which  is  difficult 
to  remove. 

The  object  of  this  chapter  has  been  attained  if  the  reader, 
by  its  perusal,  obtains  a  clear  idea  of  the  real  economic  rela- 
tions between  farmers  and  workingmen.  It  is  one  of  conflict 
ing  economic  interests  profoundly  affected  by  common  inter- 
ests in  relation  to  some  other  classes.  So  far  as  labor  seeks 
the  aid  of  legislation  to  accomplish  its  ends,  the  interests  of 
farmers  are  sometimes  with  labor  and  sometimes  against  it. 


*See  Chapter  VIII  of  this  book. 


CHAPTER  VI. 

THE  FARMER  AND  THE  TRUSTS. 

THE  term  "Trust,"  in  popular  usage,  lias  come  to  mean 
any  consolidation  of  large  industrial  or  other  enter- 
prises under  one  management.  It  will  be  used  in  that 
sense  in  this  chapter.  This  use  of  the  term  originated  in  the 
l)ractice  of  effecting  a  practical  consolidation  by  placing  a 
controlling  majority  of  the  stock  of  each  of  the  concerns  which 
it  was  desired  to  consolidate  "  in  trust"  in  the  hands  of  a  new 
corporation  especially  created  for  this  purpose.  It  was  neces- 
sary that  the  Trusts  be  corporations,  for  individuals  might 
die,  or  become  unable  to  perform  the  duties,  in  which  case  it 
would  be  necessary  for  all  parties  to  agree  upon  new  trustees, 
which  might  or  might  not  be  possible.  The  Trust  was 
always  created  for  some  definite  term  of  years,  during  which 
the  real  owners  of  tiie  stock  could  not  withdraw  it  from  the 
Trust.  The  new  corporation,  by  means  of  its  control  of  the 
stock  of  the  consolidated  companies,  could  select  their  man- 
agers and  control  or  consolidate  their  management,  thus  avoid- 
ing any  competition  between  them,  and  dividing  the  net 
profits  of  all  among  the  stockholders  of  the  different  com- 
panies, according  to  the  terms  of  the  Trust.  The  Trust  corpo- 
ration was  always  composed  of  members  of  the  companies 
consolidated.  In  due  time  litigation  ensued  in  regard  to  those 
Trusts,  which  were  attacked  as  "in  restraint  of  trade," and  the 
courts  held  them  illegal  on  the  ground  that  while  corporations 
could  be  formed  to  carry  on  any  kind  of  business,  they  could 
not,  in  the  states  where  the  litigation  occurred,  be  formed  for 
tiie  sole  purpose  of  controlling  the  business  of  other  corpora- 
tions. As  stringent  "anti-Trust"  laws  were  promptly  enacted 
in  most  of  the  states,  and  by  Congress,  the  Trusts  were  dis- 
solved and  the  practice  was  abandoned. 

Nothing  came  of  the  anti-Trust  movement,  however,  except 

(396) 


THE    FARMER    xVND    THE    TRUSTS.  397 

the  changing  of  the  temporary  combinations,  expiring  by 
limitation,  to  those  which  were  permanent.  If  it  was  desired 
to  consolidate  a  number  of  concerns  it  was  only  necessary  to 
form  a  new  company  which  should  actually  own  the  property 
of  the  concerns  to  be  consolidated.  This  was  easily  effected 
bv  giving  the  stock  of  the  new  company  in  exchange  for  the 
property  of  the  old  companies,  and  retiring  their  stock.  It  is 
not  possible  to  prevent  this  by  any  means  short  of  the  aboli- 
tion of  industrial  corporations,  and  this,  in  any  modern  civ- 
ilized nation,  can  not  for  a  moment  be  thought  of.  The  term 
"Trust"  adheres  to  these  consolidated  companies,  although  as 
a  matter  of  fact  there  may  not  be  a  real  industrial  Trust  in 
existence  in  America. 

In  regard  to  these  Trusts  the  first  thing  for  the  farmer  to 
do  is  to  accept  them  as  a  fact.  They  have  come  to  stay,  and 
will  increase  in  number  and  importance  with  the  growth  of 
our  civilization,  with  which  they  are  exactly  in  line.  The  fact 
that  they  are  thus  natural  outgrowths  of  the  progress  of  society 
should  also  convince  us  that  they  are  in  the  line  of  real  prog- 
ress. .There  is  no  question  of  their  value  to  society  in  making 
possible  more  economical  methods  of  production  and  distribu- 
tion, of  which  the  public  should  reap  the  advantage.  The 
public,  however,  does  not  always  reap  this  advantage.  It 
never  does  if  those  concerned  in  the  Trusts  can  help  it.  So 
far  as  they  can  do  so,  while  the  Trusts  earnestly  seek  to  reduce 
costs,  they  endeavor  with  equal  earnestness  to  sell  their  prod- 
ucts as  high  as  before  or  higher.  As  the  Trusts  can  exist  only 
by  virtue  of  the  power  of  law,  we  have  the  anomaly  of  the 
power  of  society  being  used  to  oppress  society,  while  the 
oppressors  are  protected  by  the  fact  that  society  can  not  use 
its  power  to  abolish  them  without  at  the  same  time  abolishing 
what  is  essential  to  the  transaction  of  its  business. 

The  problem  for  the  farmer  in  this  connection  is  therefore 
how  to  retain  the  advantages  which  the  Trusts  confer  u{)on 
society  without  enduring  the  ills  which  they  will  inflict  if 
they  can.  The  principal,  if  not  the  only  method  hitherto 
em[)loyed  by  farmers  is  the  passage  of  denunciatory  resolutions, 
sometimes  of  a  very  lurid  nature.     The  trouble  with  this 


898  THE    QUESTIONS    OF    THE    DAY. 

method  is  that  it  does  not  do  anj^  good.  Nobody  cares  any- 
thing about  the  resolutions.  Tliere  are,  however,  simple  and 
entirely  effective  methods  of  preventing  the  abuse  of  corporate 
powers,  without  injury  to  the  effectiveness  of  corporations  for 
useful  purposes.  None  of  these  means,  however,  are  likely  to 
be  made  use  of  by  the  present  generation,  as  they  involve  a 
clearness  of  understanding  and  unity  of  action  which  it  may 
require  several  generations  to  bring  about.  In  the  end  the 
Trusts  will  be  controlled  as  the  result  of  the  same  influences 
which  produce  them — the  impossibility  of  getting  on  in  any 
other  way. 

The  first  step  towards  any  useful  study  of  this  subject  must 
be  to  dismiss  all  prejudices,  and  fully  recognize  that  no 
"Trust"  is  attempting  to  do  anything  which  the  reader  would 
not  do  in  the  same  position,  or  would  not  do  now  in  regard  to 
his  own  products  if  he  had  the  power.  Year  by  year  the 
farmers  of  the  world  increase  their  efforts  to  form  Trusts  to 
control  the  sale  of  their  own  products,  and  wlienever  they  are 
successful  there  is  no  limit  to  the  price  which  they  will  set, 
except  the  limit  imposed  by  competition  or  by  the  inability  of 
customers  to  pay  more.  They  are  no  more  moved  by  con- 
templation of  the  distress  which  the  high  prices  of  necessaries 
!nay  cause  to  consumers  than  are  the  managers  of  the  great 
Trusts  of  the  nation.  Their  Trusts,  however,  have  seldom 
been  successful  or  long-lived,  by  reason  of  the  impossibility 
of  effecting  a  firm  combination  among  the  great  numbers  of 
producers.  If  the  owners  of  oil  wells  or  sugar  ftictories  or 
whisky  stills  were  as  numerous  as  the  farmers,  they  would  be 
no  more  able  to  form  Trusts  than  the  farmers.  It  is  very 
desirable  that  farmers  should  increase  their  effectiveness  in 
this  respect.  The  more  Trusts  they  can  form  the  better.  The 
trend  of  civilization  lies  in  the  direction  of  the  organization 
of  those  of  like  interests  to  deal  through  responsible  represent- 
atives with  classes  of  adverse  interests.  The  capitalist  classes 
having  the  fewer  number  and  the  greater  intelligence,  are,  as 
is  natural,  leading  the  way.  The  farmers  are  following  as 
best  they  can.     The  faster  they  follow  the  better  for  all. 

It  is  best  to  understand  the  cause  of  tlie  organization  of 


THE    FARMER    AND    THE    TRUSTS.  399 

Trusts.  The  i)opular  conception  seems  to  be  of  a  body  of 
wealthy  men,  already  in  the  enjoyment  of  exorbitant  i)rofits, 
deliberately  uniting  because  thereby  they  can  extort  greater 
and  unreasonable  profits.  Nothing  can  be  further  from  the 
truth.  In  this  I  am  not  speaking  at  random,  for  it  has 
happened  to  me  in  more  than  one  instance,  to  be  engaged  in, 
or  to  quite  thoroughly  know  about,  the  formation  of  Trusts 
both  among  manufacturers  and  among  farmers.  There  was 
no  difference  in  the  men,  or  in  their  avowed  motives.  Neither 
was  there  any  difference  in  the  outcome.  In  both  cases  the 
Trusts  first  formed  were  ineffective  and  short-lived,  and  for 
the  same  reason  that  there  was  no  mutual  confidence,  or 
general  intent  to  observe  in  good  faith  the  conditions  of  the 
Trust.  The  lack  of  good  faith  grew  out  of  the  disbelief  in 
the  good  faith  of  others.  In  both  cases,  also,  repeated  trials 
resulted  in  progress,  and  constantly  increasing  eff'ectiveness. 
In  both  cases  the  difficulty  was  with  "outsiders"  who  would 
not  unite  with  the  others,  and  in  both  cases  the  "outsidei-s" 
were  in  the  main  those  who  were  either  strongest  financially — 
meaning  by  that  freedom  from  debt  ratlier  than  magnitude 
of  operations — or  those  who  believed  that  they  could  produce 
chea[)er  tlian  others.  Finally  the  farmers  and  manufacturers 
were  alike  in  being  moved  to  cooperate  in  a  Trust  only  by  the 
fact  that  they  were  being  ruined  by  competition.  My  personal 
observation  has  been  such  as  to  fully  convince  me  that  neither 
capitalists,  manufacturers,  or  farmers  ever  cooperate  in  the 
formation  of  a  Trust  until  depressed  by  losses,  and  the  fear  of 
greater  losses.  There  is  in  the  breast  of  all  human  beings  a 
desire  for  independent  and  uncontrolled  action,  which  only 
gives  way  to  the  sternest  necessity.  Trusts  being  the  result  of 
unprofitable  business,  their  first  effort  is  an  attempt  to  raise 
prices,  and  usually  the  raise  is  justifiable.  In  this  the  manu- 
facturers are  quite  likely  to  succeed,  while  the  farmers  are  not 
so  likely,  by  reason  of  the  fact  that  they  are  very  seldom  able 
to  adequately  control  the  sources  of  supply. 

Having  thus,  I  hope,  gotten  rid  of  the  feeling  of  prejudice 
with  which  farmers  are  apt  to  approach  the  subject  of  Trusts, 
and  realized  that  the  successful  Trusts  are  doing  nothing  that 


400  THE    QUESTIONS    OF    THE    DAY. 

we  do  not  desire  to  do,  and  would  do  if  we  could,  let  us 
examine  the  practicable  methods  of  the  control  of  Trusts, 
whether  of  farmers  or  capitalists.  The  occasion  for  control 
arises  from  the  abuse  of  power,  of  which  all  Trusts  will  be 
alike  guilty  to  the  extent  of  their  ability.  For  the  present  the 
Farmers'  Trusts  do  not  need  restraint,  but  encouragement,  for 
the  reason  tliat  they  are  not  strong  enough  to  do  any  harm. 
It  is  to  the  interest  of  society  that  they  should  be  stronger. 

To  understand  how  Trusts  can  be  controlled,  it  is  first 
desirable  to  see  exactly  what  harm  they  do.  They  unques- 
tionably reduce  costs,  by  consolidating  administration,  doing 
away  with  the  expense  of  competing  salesmen,  and  conferring 
upon  all  connected  with  the  Trust  the  benefit  of  the  most 
approved  processes  and  ample  capital.  They  are  enabled  to 
effect  this  saving  by  the  use  of  the  authority  of  the  state,  by 
which  alone  they  become  incorporated  bodies,  with  power  to 
control  capital  beyond  the  reach  of  individuals.  The  harm 
they  can  do  is,  first,  in  compelling  the  public  to  pay  them 
more  than  a  fair  profit,  and,  secondly,  in  the  methods  they 
employ  to  perpetuate  their  power.  The  .latter  is  by  far  the 
most  serious.  To  make  this  more  clear  I  will  take  what  is 
known  as  the  "Sugar  Trust"  as  an  example.  Now  I  do  not 
know  that  the  Sugar  Trust  has  ever  done  an  improper  thing 
in  the  course  of  its  existence.  The  newspaper  stories  for  or 
against  it  are  not  entitled  to  respect  as  evidence,  and  person- 
ally I  know  nothing  about  it.  I  do  know,  however,  some 
things  which  it  could  do  if  its  managers  so  desired,  and  which 
it  is  within  tlie  power  of  society  to  prevent  it  from  doing.  In 
pointing  out  some  of  these  things  I  must  not  be  understood  to 
say  that  any  of  them  have  actually  been  done.  It  is  not  within 
the  plan  of  this  book  to  attack  any  one,  much  less  in  tlie 
absence  of  proof.  As  it  is  merely  an  illustration  I  do  not 
attempt  to  verify  all  the  assumed  statements.  They  might  be 
correct  if  they  are  not. 

The  Sugar  Trust  is  understood  to  be  the  American 
Sugar  Refinery,  located  on  the  Atlantic  Coast,  and  the  West- 
ern Sugar  Refinery,  on  the  Pacific  Coast.  There  is  no  legal 
bond  of  union  between  these  two  concerns,  which  are  entirely 


THE    FARMKR   AND    THE    TRUSTS.  401 

independent  of  each  other,  but  there  is  presumed  to  be  a 
perfect  understanding  between  them  in  the  allotment  of 
territory  in  whicii  each  shall  have  the  monopoly  of  the  sugar 
trade,  undisturbed  by  the  other.  Previous  to  the  beginning 
of  the  beet-sugar  industry  in  the  United  States  conditions 
were  ideal  for  the  formation  of  an  effective  Trust.  For  the 
purposes  of  the  illustration  I  shall  assume  that  conditions 
remain  as  they  were  before  we  manufactured  beet  sugar.  As 
a  matter  of  fact,  conditions  are  not,  at  this  writing,  materially 
changed,  although  they  may  become  so.  The  invention  of  a 
cheap  process  for  refining  beet  sugar  might  entirely  break  u[) 
the  Trust,  by  enabling  a  large  number  of  persons  to  engage  in 
the  business.  Fifty  years  ago,  and  even  less,  nearly  all  the 
sugar  consumed  in  the  United  States  was  "brown"  or  unre- 
fined sugar.  In  those  days  any  one  could  import  sugar  from 
any  country  where  it  was  made,  and  no  Trust  was  possible,  be- 
cause the  supplies  could  not  be  controlled.  There  might  be 
and  doubtless  were  temporary  "corners"  for  particular  grades  of 
sugar,  when  they  happened  to  become  scarce,  but  nothing  per- 
manent or  effective.  For  some  years  past,  however,  nearly  all 
sugar  used  has  been  refined.  The  public  has  become  accustomed 
to  the  granulated  and  cube  sugars,  and  every  retail  grocer 
must  keep  them  or  lose  trade.  This  also  requires  wholesale 
grocers  to  keep  them  for  the  same  reason.  A  retailer  orders 
his  supplies  from  one  or  two  houses,  and  sugar  with  the  rest. 
If  any  wholesale  house  did  not  keep  such  sugars  as  his  trade 
demanded,  the  customer  might  take  all  his  trade  elsewhere. 
Under  our  tariff  laws  refiners  of  sugar  are  "protected"  by 
such  a  rate  of  duty  above  that  charged  on  unrefined  or  "raw" 
sugars,  that  little  or  no  refined  sugar  can  be  imported,  for  the 
reason  that  our  refiners  can  sell  at  a  lower  rate  than  refined 
sugars  can  be  imported  for,  and  still  make  a  profit.  As  a 
matter  of  fact,  the  price  of  refined  sugar  is  nearly  always  kept 
a  little  below  the  price  at  which  it  can  be  imported.  There 
are,  in  many  cities,  refineries  which  were  formerly  independent, 
and  used  to  compete  strongly  with  each  other.  At  last  they 
were  nearly  all  losing  money,  and  by  the  usual  steps  a  Trust 
was  organized  which  owned  nearly  all  the  sugar  refineries  of 
26 


402  THE    QUESTIONS    OF    THE    DAY. 

the  country.  When  this  was  accomplished,  the  overproduc- 
tion, which  had  been  excessive,  was  stopped,  the  refineries 
least  favorably  situated  were  closed,  and  the  business  of 
refining  concentrated  where  it  could  be  carried  on  most 
economically.  The  competing  salesmen  were  called  in,  and 
prices  raised  to  a  profitable  rate,  all  of  which  tended  to 
economy.  Under  the  law,  and  the  habit  which  the  public 
liad  acquired,  of  consuming  mainly  refined  sugar,  the  Trust 
had  the  monopoly  of  the  sugar  trade,  and  the  cost  of  selling 
was  reduced  to  a  trifle. 

There  was,  however,  a  chance  for  abuse.  If  any  one 
started  a  new  refinery,  and  began  to  seek  for  his  share  of  the 
trade,  it  was  possible  for  the  Trust  to  put  down  the  price  of 
sugar  within  the  territory  which  the  new  factory  could  reach, 
entirely  below  cost,  while  keeping  the  rate  at  full  figures  in 
the  greater  part  of  the  country,  which  freight  rates  would 
prevent  the  new  factory  from  reaching.  Previous  to  the 
passage  of  the  inter-state  commerce  law,  it  was  also  possible 
for  the  Trust  to  get  such  special  freight  rates  as  to  give  it  an 
advantage.  Since  the  passage  of  that  law  this  has  been  pos- 
sible only  at  the  risk  of  exposure  and  punishment — a  risk, 
however,  which  is  supposed  to  have  been  frequently  taken 
without  serious  results.  If  these  measures  did  not  prove 
effective  to  ruin  the  new  factory,  there  were  still  others  pos- 
sible. The  Trust  could  refuse  to  sell  any  sugar  to  a  wholesale 
merchant,  except  upon  an  agreement  to  purchase  his  entire 
supply  of  the  Trust.  There  are  differences  in  refined  sugars, 
and  when  a  community  has  become  accustomed  to  sugars  of  a 
certain  factory  the  people  dislike  to  change.  If  a  retailer 
orders  a  certain  brand,  he  wants  that  brand  and  no  other. 
As  a  rule,  the  Trust  has  usually  controlled  the  only  certain 
and  abundant  sources  of  supply,  and  this  fact,  in  connection 
with  the  confirmed  habits  of  the  public,  has  usually  made  it 
master  of  the  situation.  It  is  true  that  the  wholesale  mer- 
chants could  import  refined  sugar,  but  it  would  cost  them  more, 
besides  the  trouble  and  expense  of  buying  in  foreign  countries, 
the  uncertainty  of  regular  supj)lies  of  uniform  quality,  satis- 
factory to  their  trade,  and  generally  a  great  deal  of  trouble 


TIIK    FARMER    AND    THE    TRUSTS.  403 

and  annoyance,  with  a  small  loss  instead  of  a  small  profit  on 
each  sale.  As  a  result  it  was  cheaper  and  more  agreeable  to 
the  wholesale  merchants,  to  submit  to  the  Trust,  and  be 
governed  by  its  rules  themselves,  meanwhile  being  faithfully 
protected  by  the  Trust  in  the  small  i)rofits  which  were 
allowed.  By  making  prices  for  sugar  delivered  within  certain 
territory,  and  different  prices  in  other  territory,  it  was  per- 
fectly feasible  for  the  eastern  and  western  branches  of  the 
Trust  to  divide  the  country  between  them  according  to  the 
terms  of  any  private  contract  which  may  exist.  In  case  of 
disagreement  between  the  two  branches,  the  natural  and  reg- 
ular course  of  events  would  be  a  severe  "fight"  in  which  one 
or  both  parties  would  invade  the  territory  of  the  other  with 
cut  prices,  possibly  building  a  new  refinery,  and  generally 
carrying  on  an  expensive  warfare  by  which  the  public  would 
temporarily  benefit  while  it  was  going  on,  and  ultimately  pay 
for,  when,  in  the  course  of  events,  the  contestants,  tired  of 
losing  money,  had  settled  their  differences  by  a  new  arrange- 
ment stronger  than  ever. 

I  have  selected  the  Sugar  Trust  as  the  example,  not  only 
because  the  conditions  for  such  a  Trust  are  better  than  for 
most  others,  but  because  they  tend  to  certain  methods  for  main- 
taining its  powers  of  which  I  wish  to  speak.  It  is  not,  how- 
ever, the  only  important  Trust.  There  are  hundreds  of  them,* 
many  of  which  are  far  more  oppressive  to  the  farmers  than  the 
Sugar  Trust  can  be,  because  the  margin  between  the  actual  cost 
of  refined  sugar  and  the  price  at  which  it  can  be  imported  is 
never  large  enough  to  make  a  very  great  difference  in  what 
will  be  used  by  one  family,  the  immense  quantity  sold,  how- 
ever, making  the  profit  to  the  Trust  very  large.  In  such 
articles  as  plows,  sewing-machines,  bicycles,  stoves,  agricul- 
tural machinery,  and  the  like,  in  which  there  are  or  ma}'-  be 
Trusts,  sometimes  far  more  eftectively  protected  by  patents 
than  sugar  can  be  by  the  tariff,  the  chance  for  unreasonable 
profits,  and  the  loss  to  individual  farmers  thereon,  may  be  far 
more  serious   than  from  any  Trust   controlling   sugar,  nails, 


*See  Appendix  G,  VI,  for  list  of  Trusts. 


404  THE    QUESTIONS    OF    THE    DAY. 

thread,  petroleum,  or  any  of  the  staples  of  every-day  purchase. 
It  may  be  accepted,  however,  as  a  fact,  that  there  are  or  will  be 
Trusts  controlling  the  majority  of  articles  which  the  farmer 
buys,  and,  as  I  think,  upon  the  whole  it  is  desirable  tliat 
tliere  should  be.  Even  as  things  are  now,  I  am  convinced 
that  the  farmer  often  gains  pecuniarily  rather  than  loses  by 
the  existence  of  Trusts.  That,  however,  is  no  reason  why 
they  should  be  permitted  to  abuse  their  power. 

The  most  serious  injury,  in  my  judgment,  that  the  Trusts 
may  inflict  upon  the  public  is  in  connection  with  the  methods 
which  they  are  tempted  to  use  to  sustain  themselves.  The 
profits  of  the  Sugar  Trust  depend  upon  the  action  of  Congress 
in  relation  to  the  tariff,  and  this,  in  turn,  depends  upon  tlje 
action  of  voters  and  political  parties.  So  long  as  the  policy  of 
protection  is  the  policy  of  the  American  Government,  it  is 
proi)er  that  the  sugar  refiners  should  have  their  share  of  pro- 
tection. They  employ  a  great  number  of  men  who  would  not 
otherwise  be  employed  in  this  country.  So  long  as  it  is  our 
policy  to  protect  industries,  no  one  will  dispute  their  claim  to 
a  share  in  it.  The  same  statement  applies  to  all  other  interests 
which  are  protected  by  tariffs  and  combined  in  Trusts. 

But  the  fact  that  these  conditions  create  so  powerful  and 
so  direct  a  pecuniary  interest  in  the  passage  of  certain  laws, 
extending  into  the  details  of  the  schedules  of  the  tariff  acts, 
renders  it  almost  impossible  that  the  truth  should  reach  the 
people,  at  least  as  to  details,  or  that  legislation  should  be 
impartially  enacted.  The  policy  of  tlie  United  States  is 
apparently  well  settled  to  raise  a  great  part  of  its  national 
revenue  from  duties  on  imports,  and  ai)parently  with  the 
intention  of  giving  actual  protection,  whether  revenue  is 
needed  or  not.  At  any  rate  a  tariff  for  revenue  is  protection 
to  the  extent  that  it  goes,  and  while  the  peoi)le,  in  party  con- 
ventions and  by  their  votes,  may  determine  the  general  prin- 
ciples of  the  legislation  which  shall  bo  enacted,  with  the  actual 
details  of  the  tariff  acts  tliey  do  not  and  can  not  concern 
themselves.  But  it  is  the  details  that  count,  and  to  the  extent 
that  it  is  possible  to  do  so,  the  Trusts  shape  the  details  of  the 
bills  in  which  they  are  interested. 


THE    FARMER    AND    THE    TRUSTS.  405 

They  accomplish  this  end  by  the  expenditure  of  money 
and  patronage.  In  the  aggregate  the  Trusts  have  the  disposal 
of  an  enormous  amount  of  legitimate  business  which  they 
may,  if  they  choose,  make  use  of  to  control  political  influence. 
There  is  little  doubt  that  they  do  so  use  it.  They  are  large 
contributors  to  the  funds  of  political  parties,  and  the  men  who 
supply  the  money  to  pay  political  orators,  subsidize  the  press, 
supply  brass  bands  and  uniforms,  and  distribute  partisan 
documents,  are  the  ones  who  control  the  appointment  to 
office  in  the  event  of  victory  at  the  polls.  Sometimes  these 
appointees  are  the  servile  tools,  but  more  often  I  think  merely 
the  loyal  friends  of  those  by  whose  influence  they  have 
thrived.  They  are  bound  to  them  by  conviction  and  habit, 
and  hardly,  if  at  all,  realize  the  pecuniary  tie  that  binds  them 
They  are  ready  and  glad  to  serve  the  friends  who  have  served 
them.  There  are  many  government  positions  in  which  it  is 
possible  to  be  highly  serviceable  to  friends,  without  consciously 
violating  any  official  duty.  In  the  aggregate  a  body  of  bright 
men  thus  api)ointed  supply  the  "atmosphere"  in  which  legis 
lation  is  carried  on,  and  they  can  obtain  and  supply  the  most 
valuable  information,  as  legislation  proceeds  and  takes  shape. 
The  "civil  service  laws"  were  a  terrific  blow  to  influence  of 
this  sort,  and  the  opposition  to  it  is  mainly  inspired  by 
pecuniary  interests. 

Congress  is  controlled  mainly  by  the  control  of  nominations. 
There  are  very  few  congressional  districts  in  which  the  Trusts 
are  not  influential.  Let  any  one  known  to  be  absolutely 
independent  seek  to  obtain  a  nomination  for  Congress,  and  he 
will  find  his  way  blocked  in  ways  that  he  can  not  understand. 
It  costs  money  to  receive  a  nomination  and  election  to  Congress, 
or  to  any  high  office,  and  the  majority  of  those  who  seek  those 
offices  are  not  in  a  position  to  sustain  the  expense,  which  will 
always  involve  an  "assessment"  of  from  $1,000  upwards  to  bo 
paid  to  the  party  committee  for  "campaign  purposes."  This 
is  usually  but  a  trifling  part  of  the  expen.se.  The  money  for 
these  expenses  comes  largely  from  the  coff'ers  of  the  Trusts, 
and  may  be  conveyed  in  such  ways  that  even  the  most 
honorable  men  see  no  objection  to  receiving  it.     The  candidate 


406  THE    QUESTIONS    OF    THE    DAY. 

is  honestly  a  protectionist,  and  upon  what  grounds  can  he 
refuse  to  accept  aid  from  those  who  desire  what  he  seeks  to 
accomplish?  Nevertheless,  there  is  a  personal  obligation 
created,  and  when  the  details  of  the  bill  come  to  be  made  up, 
he  would  be  more  than  human  if  he  did  not  do  his  best  to 
do  well  for  those  who  helped  him,  even  to  trading  votes  or 
some  detail  to  which  he  really  objects.  It  is  in  these  ways, 
beginning  way  back  in  the  primary  elections  for  delegates  to 
the  nominating  conventions,  that  the  Trusts  expend  their 
money  for  the  control  of  national  and  state  politics.  Every 
county  and  every  city  has  its  coteries  of  bright  men  who  are 
strongly  interested  "for  the  good  of  tlie  party,"  and  wlio  by 
giving  thought  and  study  to  detail  are  able  to  and  do  control 
nominations.  To  a  great  extent  these  "  politicians"  are  paid 
outright  by  interested  parties  who  may  be  hundreds  of  miles 
away,  to  "  fix  "  a  delegation.  In  a  general  election,  when  theje 
are  many  officers  for  which  delegations  are  to  be  "fixed,"  there 
is  often  quite  a  thriving  business  for  a  few  ^nonths.  In  the 
end  these  disinterested  gentlemen  seek  nothing  for  themselves, 
but  are  willing  to  accept  places  on  the  local  party  committees, 
and  be  ready  to  "  fix  "  delegations  for  some  one  else  at  the  next 
elections.  Usually  these  local  politicians  will  do  nothing  for 
anybody  except  for  money,  and  they  are  at  the  service  of  any 
one  who  can  pay  them.  Almost  any  one  who  lias  ever  been  a 
candidate  for  any  office  whose  possession  gives  the  power  to 
confer  favor,  could  give  interesting  evidence  as  to  the  power  of 
money  in  politics,  and  the  sources  from  which  it  comes.  As  a 
rule,  however,  they  can  not  be  got  to  say  anything.  If  they 
have  not  received  "aid,"  they  can  not  prove  anything.  If  they 
have  they  do  not  wish  to.  The  amount  of  money  spent  in 
actual  bribery  of  elected  officers  by  Trusts,  except  in  the  case 
of  senatorial  elections,  I  believe  to  be  small.  Comparatively 
few  men  who  can  be  elected  to  a  responsible  office  can  be 
actually  bribed.  But  they  can  be  surrounded  by  influences 
which,  unless  persons  of  very  strong  character,  they  are  uuable 
to  resist.  The  influence  of  Trust  money  in  controlling  elec- 
tions is  unquestionably  the  most  serious  abuse  of  which  Trusts 
are  guilty.      The   debauching   of    the  local    political    mana- 


THE    FARMER    AND    THE    TRUSTS.  407 

gers,  carrying  the  corrupt  influence  of  money  to  the  very 
liearthstones  of  the  people,  does  far  more  liarni  than  the 
unreasonable  profits  which  may  sometimes  be  extorted  from 
the  people  as  the  result  of  legislation  so  obtained.  I  have 
spoken  of  national  legislation  in  connection  with  Trusts, 
because  it  is  mainly  by  tariff  laws  and  patent  laws  that  Trusts 
have  thus  far  been  able  to  live,  but  the  same  influences  are 
used  to  control  state  legislation,  in  wliich,  however,  railroads 
and  other  interests  wliich  state  legislation  may  particularly 
affect,  supply  the  corrupting  influence. 

The  industrial  Trusts  exist  mainly  by  virtue  of  tariff  and 
patent  laws.  Other  enterprises,  like  railroads,  telephones,  and 
the  like,  secure  their  monopolistic  advantages,  which  must 
form  the  basis  of  all  Trusts,  in  other  ways.  I  have  spoken 
mostly  of  those  based  upon  tariff  laws  because  they  are  the 
most  numerous  and  most  oppressive. 

The  remedy  for  the  abuses  of  Trusts,  however,  would  not 
be  found  in  the  repeal  of  tariff  and  patent  laws,  the  result  of 
which  would  be  the  expansion  of  Trusts  on  a  more  gigantic 
scale  than  ever,  because  they  would  then  necessarily  be  made 
strong  enough  to  overbear  competition  by  the  sheer  weight  of 
capital.  The  Trusts  are  now  adjusted  to  conditions  as  they 
exist.*  They  would  speedily  readjust  themselves  to  such  con- 
ditions as  might  arise.  They  would  probably  become  inter- 
national, after  the  manner  of  the  Standard  Oil  Company, 
which  is  already  international. 

The  first  step  in  an  attempt  to  control  the  Trusts  is  to  get 
out  of  the  darkness  and  into  the  light.  We  do  not  know  what 
they  are  doing,  and  we  need  to  know.  Then  we  can  permit 
them  to  continue  doing  what  is  right  and  stop  their  doing 
what  is  wrong.  This  appears  to  me  self-evident.  The  army 
whose  every  move  is  known  to  the  enemy,  while  those  of  the 
adversary  are  not  known  until  they  have  been  made,  is  in  a 
way  to  be  surely  beaten.  That  is  exactly  the  condition  of  the 
contest  between  the  farmers  and  the  Trusts.  Any  continuance 
of  the  contest  on  the  present  basis  is  quite  certain  to  result  in 
continued  discomfiture  of  the  people.  The  warfare  is  carried 
on,  as  already  shown,  by  paid  guerrillas  living  among  the 


408  THE    QUESTIONS    OF    THE    DAY. 

people  themselves,  and  supported  under  the  protection  of  laws 
enacted  by  the  people.  It  is  a  ridiculous  situation  and  should 
end.  The  way  to  stop  it  is  to  shut  off  the  source  of  supply. 
The  guerrilla  politicians  are  entirely  mercenary  and  will  not 
fight  a  moment  after  their  pay  is  stopped. 

The  laws — state  and  national— should  provide  that,  in 
return  for  the  protection  of  the  corporation  laws,  the  accounts 
and  proceedings  of  all  corporations  possessing  capital  or  trans- 
acting business  above  some  fixed  amount,  should  be  absolutely 
public — no  detail  whatever  being  excluded  from  the  public 
gaze,  and  to  assure  it,  a  representative  of  the  public  should 
audit  all  accounts  and  attend  all  meetings  of  directors.  It  will 
be  objected  by  Trusts  that  this  is  exposing  their  business  to 
their  competitors.  This  is  true,  and  exactly  what  is  desired. 
Their  competitors  will  be  the  most  certain  of  all  men  to  dis- 
cover and  trace  out  improper  acts.  The  public  can  rest  in 
comparative  security  when  knowing  that  competitors  are  on 
the  watch.  If  money  is  given  to  men  who  "do  politics"  we 
wish  to  know  who  gets  it  and  exactly  what  he  gives  for  it. 
A  proper  voucher  would  tell  the  stor^^  That  should  be  the 
price  demanded  by  the  public  for  the  certificate  of  incorpora- 
tion which  enables  the  corporation  to  do  business.  If  its 
members  do  not  like  it  they  need  not  pay  the  price.  Nobody 
compels  them  to  form  great  corporations.  The  world  will  get 
on  if  they  are  not  formed.  It  is  desirable  that  they  should  be 
formed  if  they  can  be  absolutel}^  controlled.  Otherwise  not. 
Under  proper  conditions  they  would  be  instruments  of  great 
value.     Under  present  conditions  they  are  a  menace  to  societ3^ 

Of  course  there  would  be  additional  legislation  for  the 
prevention  of  specific  evils  as  discovered.  It  is  not  necessary 
to  go  into  that  here.  Its  character  is  obvious.  The  prerequi- 
site to  any  successful  legislation  is  a  complete  and  absolute 
knowledge  of  facts.  This  can  only  be  obtained  by  the  method 
pointed  out.  When  that  step  has  been  taken  tlie  next  will 
become  apparent.  My  object  at  this  time  is  to  concentrate 
attention  on  the  one  vital  point. 

If  some  unbelieving  reader  imagines  that  what  is  here  said 
is  not  correct,  let  him  seriously  set  about  getting  one  of  the 


THE    FARMER    AND    THE    TRUSTS. 


409 


great  political  parties  to  incorporate  in  its  platform  the  prin- 
ciple which  I  have  announced,  and  which  I  am  sure  will 
commend  itself  to  his  judgment,  and  he  will  be  speedily 
undeceived.  He  will  discover  that  any  hitherto  supposed  con- 
test carried  on  against  the  Trusts  was  a  mere  skirmish. 
Against  this  proposal  he  would  see  real  war.  And  yet  it  does 
not  primarily  propose  to  hinder  the  Trusts  from  doing  whatever 
they  please,  nor  is  there  any  ultimate  intent  to  hinder  them 
from  doing  whatever  is  approved  by  the  moral  sense  of  the 
community.  Years  since  I  myself  once  proposed  this  plank — 
restricting  it  to  quasi-public  corporations,  like  railroads  and 
water  companies — in  a  committee  which  sat  up  all  night  to 
construct  the  most  thundering  denunciation  of  railroads  which 
human  ingenuity  could  devise,  to  be  adopted  in  a  great  polit- 
ical convention  then  in  session.  The  public  mind  was  thought 
at  the  time  to  demand  such  a  bolt,  and  it  was  forthcoming — 
but  there  were  those  on  hand  to  see  that  it  was  not  aimed  at 
anything  in  particular.  I  was  not  specially  uninfiuential  in 
the  committee  in  other  respects,  and  so  far  as  I  could  see  had 
as  much  force  as  any  other  member  in  shaping  the  thought 
and  the  language  of  the  party  platform,  but  that  proposition 
was  voted  down  without  a  ripple. 

As  I  have  said,  I  do  not  expect  the  present  generation  to 
unite  on  this  principle,  simple  and  obvious  as  it  is.  It  takes 
too  many  years  to  educate  the  public  mind  to  grasp  simple 
truth.  That  it  will  come  in  time  is  sure  because  it  is  the  only 
way  out  of  the  difficulty,  and  in  the  progress  of  our  evolution 
we  shall  come  to  it  and  take  it. 


This  chapter,  up  to  the  beginning  of  this  paragraph,  was 
written  about  1896.  If  it  had  been  written  at  the  time  these 
pages  go  to  press,  May,  1899,  it  is  quite  possible  that,  under  the 
influence  of  the  growing  excitement  in  regard  to  Trusts,  it 
might  have  been  written  in  a  somewhat  different  vein.  For 
that  reason  I  let  it  stand  as  originally  prepared.  Utterances 
framed  under  the  influence  of  a  strong  public  feeling  are  not 
likely  to  be  very  wise,  or  to  be  long  remembered.      Daily,  for 


410  THE    QUESTIONS    OF    THE    DAY. 

some  months,  the  press  despatches  have  told  of  new  Trusts 
formed  with  enormous  capital,  with  the  apparent  intent  to 
victimize  the  world.  The  political  leaders  on  all  sides  see  in 
this  movement  the  opportunity  to  divert  public  attention  from 
issues  which  they  do  not  wish  to  discuss,  and  are  contriving 
how  their  party  may  most  readily  be  made  to  appear  as  the 
only  reliable  champion  of  the  people  against  unholy  and 
oppressive  combinations  wliich  the  "other  party"  can  not  be 
trusted  to  oppose.  So  far  as  either  party  can  manage  to  put 
the  other  at  a  disadvantage,  the  question  of  the  Trusts  now 
seems  likely  to  be  an  issue  in  the  next  presidential  campaign. 
What  form  the  issue  will  take  it  is  not  now  possible  to  guess. 
It  is  possible  that  it  may  be  on  such  rational  lines  as  are 
indicated  in  this  chapter,  but  it  is  not  likel}^  The  political 
platforms  will  probably  contain  tremendous  fulmi nations 
against  the  oppression  of  concentrated  wealth  and  rhetorical 
pledges  which  will  get  votes  but  commit  the  party  to  nothing 
in  particular.  So  long  as  political  campaigns  cost  great  sums 
which  rich  men  are  relied  on  to  supply,  political  platforms  can 
not  contain  definite  programs  for  the  effective  control  of  capital, 
until  capital  itself  desires  it.  Tiiis  will  come  in  due  time,  and 
from  the  same  causes  which  have  already  made  railroads  ready 
to  accept  control, — the  competition  of  capital  with  capital,  and 
the  fear  of  popular  disturbances. 

If  the  reports  which  are  now  inflaming  the  popular  imagi- 
nation were  true,  some  part  of  the  basis  of  the  reasoning  in 
this  chapter  would  be  shown  to  be  unsound,  for  the  reports 
indicate  that  capital  is  combining,  not  as  the  result  of  unbear- 
able competition,  but,  while  in  tlie  full  tide  of  prosperity,  with 
the  deliberate  intent  to  l^ecome  richer,  by  combining  to  extort 
additional  and  undue  profits  from  a  struggling  people. 

Doubtless  there  are  such  cases,  usually  not  destined  to 
succeed,  but  in  the  main  I  place  no  confidence  in  the  reports. 
Of  course  I  do  not  doubt  that  articles  of  incorporation  are 
constantly  filed,  creating  cor})orations  of  enormous  capital  for 
the  control  of  almost  every  commodity  in  common  use;  but 
the  most  of  them,  I  am  sure,  represent  nothing  but  the  fact 
that  some  party  of  "  promoters  "   have  obtained,  or  hope  to 


THE    FARMER    AND    THE    TRUSTS.  411 

obtain,  "options"  to  purchase  the  properties  involved,  usually 
at  prices  far  in  excess  of  their  value,  and  have  organized 
corporations  to  take  over  the  property.  If  tlie  "promoters" 
can  sell  the  stock  of  these  great  corporations  tliey  will  buy  the 
})roperty,  and  retire  rich.  Those  who  buy  the  stock  will  lose 
all  the  money  paid  in  excess  of  the  real  value  of  the  property 
In  a  few  instances,  doubtless,  there  will  be  temporary  success, 
but  capital,  however  concentrated,  will  never  be  able  to  really 
and  permanently  oppress  the  people,  for  the  people  will  not 
permit  it. 

The  fact  is  that  the  American  people,  after  a  few  prosperous 
years,  are  now  ripe  for  an  era  of  speculation,  and  those  who 
live  by  promoting  speculation  have  seized  upon  the  Trust  idea 
as  affording  their  opportunity.  The  unquestioned  success — for 
the  time  being — of  some  of  these  enterprises,  in  which  the 
property,  depressed  by  long  competition,  was  bought  in  at 
really  low  prices, and  greatly  raised  in  value  by  organization,  has 
opened  the  way.  Great  Britain  has  just  had  such  an  experi- 
ence. A  sharp  but  unscrupulous  person,  known  as  Ernest  T. 
Hooley,  organized  in  this  way  one  or  two  companies,  which 
were  really  successful,  and  for  a  time  brilliantly  so,  upon  the 
strength  of  which  a  craze  started,  which  brought  ruin  to  many, 
and  the  speculator  himself  to  the  bankruptcy  court.  Some- 
thing like  this  is  now  "  in  the  air"  in  America. 

At  the  same  time  the  genuine  organization  of  substantial 
interests,  in  a  natural  way,  and  under  the  pressure  of  com- 
petition, is  also  doubtless  going  on,  and  the  problem  of  properly 
and  effectively  dealing  with  them  becomes  daily  more  pressing. 
I  think  the  proper  metliod  of  beginning  is  indicated  in  the 
preceding  pages  of  this  chai)ter.  The  next  step  to  take  will  be 
indicated  by  the  facts  when  disclosed.  Wild  denunciation  and 
programs  which  do  not  go  to  the  root  of  the  evil,  are  worse 
than  useless.  They  are  dangerous.  If  the  people  are  inflamed, 
and  the  cause  of  their  discontent  not  removed,  there  is  danger 
to  the  public  peace.  No  generation  has  ever  been  free  from 
this  danger,  and  ours  is  not.  But  we  can  not  abolish  the 
possibility  of  Trusts  without  paralyzing  business.  Whoever  has 
anvthing  to  sell,  whether  it  be  manufactures,  farm  produce,  or 


412  THE    QUESTIONS    OF   THE    DAY. 

labor,  desires  to  be  in  a  Trust.  A  law  which  could  suppress  the 
Oil  Trust  would  luake  effective  marketing  societies  of  farmers 
impossible,  as  well  as  associations  for  the  sale  of  labor.  There 
can  be  but  one  law  for  the  rich  and  poor. 

The  proper  course  to  take  is  not  to  abolish  Trusts,  but  to 
control  them  ;  not  to  run  from  them,  but  to  defy  them;  not  to 
permit  them  to  oppress  us,  but  to  make  of  them  our  useful 
servants.  To  allow  a  few  to  oppress  the  many  is  absurd,  and 
it  will  not  be  long  permitted.  Society  is  not  going  to  the  dogs  ; 
none  but  the  unjust  need  fear  the  result.  It  is  not  difficult  to 
layout  an  effective  program,  although  doubtless  it  may  involve 
some  reconstruction  of  our  habits  of  tliought  and  methods  of 
procedure.  If  a  Trust  is  enabled  to  become  oppressive  through 
tlie  protection  of  the  tariff,  prescribe  the  conditions  under 
which  the  tariff  shall,  without  legislation,  be  removed  from 
the  commodity  involved;  if  by  means  of  a  patent,  prescribe 
the  conditions  under  which  the  patent  shall  lapse;  if  by 
reason  of  legal  technicalities,  or  the  force  of  logical  inferences 
from  constitutional  provisions,  reform  the  procedure  of  the 
courts,  or  amend  the  constitution;  if  by  reason  of  the  impossi- 
bility of  prompt  remedial  administrative  measures,  strengthen 
the  executive  authority.  The  way  will  open  when  the  people 
make  up  their  minds  to  move.  And  it  will  be  a  proper  and 
just  way.  The  people  need  not  fear  the  money  power.  Indeed, 
they  can  not  fear  it  half  so  much  as  the  money  power  fears  the 
people,  whose  power  it  knows.  But  with  power  goes  responsi- 
bility. It  is  the  duty  of  the  people  liaving  the  power,  to 
exercise  it  wisely.  They  need  capital,  and  should  comj^el  it  to 
be  their  servant,  paid  pro])erly,  and  protected  carefully,  but 
still  their  servant.  This  they  will  do  as  they  come  to  under- 
stand the  subject.  And  in  this  movement  the  farmers,  the 
conservative  class,  with  something  to  lose  an  1  yet  much  to 
gain,  should  take  the  lead. 


CHAPTER    VII. 

THE    FARMER    AND    THE    REFERENDUM. 

DIRECT  legislation  by  the  people  was  the  ordinary 
method  of  government  in  the  ancient  republics.  Rep- 
resentative government  is  a  comparatively  modern 
invention,  made  necessary,  in  nations  desiring  to  maintain  a 
free  government,  by  the  increasing  territorial  areas  of  states, 
and  consequent  impossibility  of  assembling  the  entire  body  of 
voters.  Direct  legislation  in  local  affairs,  however,  has  always 
been  a  feature  of  local  government  in  New  England,  where 
"town  meetings"  regulate  many  of  the  details  of  local  govern- 
ment. Traces  of  direct  legislation  in  local  affairs  continue  to 
exist  in  many  places  among  the  Germanic  races. 

At  the  present  time  there  is  a  strong  feeling  among  a  large 
class  in  this  country,  in  favor  of  direct  legislation,  not  only  to 
a  much  larger  extent  in  local  affairs,  but  in  regard  to  many 
matters  of  state  and  even  national  legislation.  The  movement 
is  based  on  the  allegation  that  the  people  are  better  able  to 
judge  what  they  wish  than  to  select  men  who  will  perform 
their  will.  Of  those  elected  to  legislative  positions  it  is  found 
that  a  certain  number  will  betray  their  trust,  frequently  in 
sufficient  number  to  defeat  the  will  of  the  majority.  The 
remedy,  of  course,  is  direct  legislation  on  such  subjects  as  the 
people  desire  to  retain  fully  in  their  own  control.  It  is 
claimed  that  the  general  intelligence  of  the  people,  and  the 
facilities  for  the  rapid  diffusion  of  information,  are  now  such 
that  people  can  act  intelligently  and  wisely  on  many  subjects, 
which  formerly  their  own  interests  would  compel  them  to 
intrust  to  the  decision  of  representatives  who  would  be  able 
to  act  in  the  light  of  information  which  would  never  reach 
the  people. 

The  obstacle  to  the  progress  of  the  movement  for  direct 
legislation  has  been   the  fact  that  it  has  been  most  loudly 

(413) 


414  THE    QUESTIONS    OF    THE    DAY. 

demanded  by  what  may  be  termed  the  "unbalanced  class," 
meaning  those  who  are  so  enveloped  in  one  idea  that  they  can 
see  no  force  or  value  in  anything  else.  The  combination  of  a 
number  of  these  extremely  dissatisfied  elements  often  pro- 
duces a  curious  jumble  of  "demands,"  not  always  having 
much  relation  to  each  other,  and  very  few  of  which,  taken 
singly,  could  command  any  important  support  at  the  polls. 
As  "direct  legislation"  is  always  one  of  the  "demands"  of 
extremists  in  social  reform,  the  tendency  has  been  to  condemn 
this  with  the  rest. 

I  do  not  think  this  is  wise.  All  reforms  have  begun  with 
extremists,  some  of  whom  in  past  ages  have  suffered  martyr- 
dom for  the  support  of  principles  which  are  now  cherished  by 
enlightened  men  everywhere.  Mankind  is  conservative,  and 
always  will  be,  and  direct  legislation  will  be  found  the  most 
effective  of  preventives  of  radical  legislation  of  all  kinds. 
The  real  objection,  from  the  point  of  view  of  the  philosoplier, 
is  the  danger  that  it  may  hinder  the  march  of  real  progress; 
that  tlie  people  will  not  do  what  the  wisest  of  them  see  really 
ought  to  be  done.  It  appears  to  many,  however,  that  upon 
the  whole  it  is  not  best  to  try  to  go  much  faster  than  the 
people  are  ready  to  go.  Too  rapid  progress  often  means 
violent  reaction.  The  nation  which  progresses  slowly  and 
surely  in  the  development  of  its  national  life  may  thereby 
become  the  strongest  and  happiest.  It  is  alleged  that  the 
people  are  often  swayed  by  passion  and  prejudice  rather  than 
by  reason,  and  that  no  one  could  tell  what  ruin  might  be 
wrought  in  a  moment  of  passion  by  people  so  moved,  and 
instances  are  cited  in  abundance  from  ancient  history  to 
illustrate  the  brutality  and  injustice  of  the  voting  mob.  To 
this  it  may  be  replied  that  in  the  first  place  ancient  history  is 
largely  partisan,  and  we  do  not  know,  for  example,  that  the 
history  of  the  life  and  death  of  Socrates  is  correct,  as  it  has 
come  down  to  us.  In  modern  times  we  find  bad  men  whose 
conversation  is  irreproachable,  and  Socrates  may  have  been 
such  a  man,  and  the  Athenians  justified  in  putting  him  to 
death.  Men  were  certainly  more  brutal  in  olden  days  than 
now,  and  human  life  was  less  sacred.     Finally,  the  peoples  of 


THE    FARMER    AND    THE    REFERENDUM.  415 

the  ancient  republics  were  not  of  races  who  have  aemon- 
strated  the  capacity  for  self-government,  and  the  republics  fell 
because  the  people  themselves  became  corrupt.  Our  republic 
will  do  likewise,  if  we  lose  our  virtue  as  a  people.  No  nation 
of  the  Germanic  race  has  ever  yet  done  this  or  shown  signs  of 
it,  nor  do  I  recall,  in  a  cursory  glance  over  such  history  as  I 
know,  any  instance  among  people  of  these  races  where  actual 
injustice  was  ever  done  by  a  solemn  vote  of  the  people. 

Regardless  of  its  origin,  I  am  convinced  that  the  principle 
of  direct  legislation  is  rapidly  gaining  support  among  the  best 
classes  of  our  body  politic,  and  that  it  will  be  more  and  more 
applied  in  practice  as  time  goes  on.  It  will  not  be  well  to 
have  it  progress  too  rapidly.  The  habit  of  command  is  as 
essential  to  a  wise  exercise  of  that  function  in  a  people,  as  in 
the  commander  of  a  war  ship.  A  man  who  had  perfect 
knowledge  of  the  structure  and  powers  of  a  battle-ship,  and 
who  had  in  him  the  stuff  for  a  great  naval  commander,  would 
run  great  danger  of  "losing  his  head"  if  pitchforked  into  such 
a  command,  or  into  the  command  of  a  squadron,  from  a  posi- 
tion in  which  he  had  always  been  a  subordinate.  He  needs 
the  discipline  of  smaller  commands  to  prepare  him  for  a  great 
trust.  In  like  manner  the  people  need  the  practice  of  direct 
legislation  in  local  affairs  to  prepare  them  for  the  exercise  of 
power  over  a  wider  sphere  of  action.  The  habit  of  acting 
under  responsibility  is  not  acquired  in  a  day. 

The  methods  by  which  it  is  proposed  that  the  people  shall 
proceed  in  direct  legislation,  are  known  as  the  "initiative"  and 
the  "  referendum."  By  the  "  initiative"  is  meant  that  upon  a 
demand  signed  by  a  fixed  number  of  voters,  the  legislative 
body  shall  be  bound  to  submit  to  the  vote  of  the  people  the 
proposition  embraced  in  the  demand.  The  number  required 
to  make  the  demand  effective  is  usually  placed  at  fifteen  per 
cent  of  the  voters,  it  being  assumed  that  so  large  a  number 
could  not  be  got  to  unite  in  a  demand  upon  any  trivial  occa- 
sion, or  one  upon  which  there  was  not  good  reason  for 
demanding  a  vote.  In  practice  any  number  of  people  who 
desired  that  some  question  should  be  submitted  to  vote  would 
circulate  a  demand  for  signatures,  and  if  fifteen  per  cent  of 


416  THE    QUESTIONS    OF    THE    DAY. 

the  voters  should  sign,  or  any  number  which  the  law  might 
require,  the  question  would  be  submitted.  Some  propose  to 
add  to  this  what  is  called  the  power  of  "recall."  By  that  is 
meant  that  upon  a  demand  signed  as  already  described,  any 
elected  officer  would  be  voted  upon  again,  and  if  defeated 
would  lose  his  office.  There  are  very  serious  objections  to  this. 
The  terms  of  office  are  short  in  this  country,  and  the  penalties 
for  malfeasance  plain  and  severe.  Passion  and  prejudice 
operate  much  more  strongly  in  regard  to  persons  than 
principles,  and  it  would  be  within  the  power  of  a  small  num- 
ber of  agitators  to  harass  unreasonably  any  officer  who  might 
be  unpopular  among  them.  Under  the  operation  of  the  ini- 
tiative it  is  quite  probable  that  at  first  there  would  be  unwise 
proceedings.  There  are  always  a  certain  number  of  unreason- 
able persons  in  the  community,  who  are  kept  constantly 
stirred  up  by  professional  agitators.  Elections  are  expensive, 
and  if  the  people  were  called  upon  to  vote  too  often,  or  at 
unreasonable  times,  they  would  abolish  or  modify  the  law. 
There  is  no  instance,  so  far  as  I  know,  of  the  adoption  of 
the  initiative  in  the  United  States.*  It  has  been  proposed 
in  some  municipal  charters,  and  may  have  been  adopted, 
but  it  has  never,  I  think,  been  used.  It  is,  however,  quite 
certain  to  be  incorporated  in  the  charter  of  some  city  and 
given  a  trial.  In  my  judgment  it  would  not  amount  to 
much.  The  people  are  good  judges,  but  weak  in  execution. 
Any  law  that  the  people  really  desire  they  are  pretty  sure  to 
get.  Its  greatest  value  would  be  in  procuring  the  submission 
of  proposals  for  acquiring  public  utilities,  like  street  railroads 
or  water  works,  to  municipalities,  at  times  when  corrupt  city 
governments  might  refuse  to  consider  the  subject.  It  would 
not  be  difficult  to  so  restrict  the  subjects  as  to  which  the 
initiative  could   be  invoked,  as  to   prevent   the   people  from 


*  The  constitution  of  Virginia  contains  a  provision  for  the  exercise  of  a  l<ind 
of  initiative  in^case  the  Legislature  fails  to  act  in  a  certain  case,  and  the  con- 
stitution of  Georgia  prescribes,  as  the  only  method  by  which  amendments  can 
be  made,  petitions  for  a  constitutional  convention  signed  by  a  majority  of  voters 
in  each  county, — a  provision  doubtless  intended  to  prevent  any  amendment  lor 
the  present.     No  action,  I  presume,  has  ever  been  had  under  either  provision. 


THE    FARMER   AND    THE    REFERENDUM.  417 

being  disturbed  about  matters  upon  which  the  majority  had 
no  wish  to  vote. 

The  "referendum  "  is  a  far  more  important  matter,  and  is 
certain,  as  I  think,  to  be  employed  more  and  more.  The 
people  of  the  United  States  are  no  strangers  to  this  proceeding, 
which  is  frequently  employed  in  the  adoption  of  state  constitu- 
tions, and  municipal  charters,  and  in  voting  upon  special  taxes 
and  tlie  incurring  of  public  debt,  change  in  political  subdi- 
visions, and  the  like.  It  is  proposed  to  extend  the  application 
of  the  principle,  by  requiring  the  submission  of  certain  classes 
of  laws  to  a  vote  of  the  people.  There  has  been,  so  far  as  I 
know,  no  definite  statement  from  any  authoritative  source,  as 
to  the  exact  classes  of  questions  which  should  be  submitted  to 
the  i)eo[)le,  but  in  the  main  I  suppose  they  would  be  such  as 
would  affect  the  public  burdens.  There  is  no  doubt,  I  think, 
tliat  the  initiative  and  tlie  referendum  are  most  ardently 
supported  by  those  who  believe  that  their  use  would  soon 
result  in  great  modifications  of  the  social  order,  involving  in 
many  cases  the  sequestration  of  what  are  now  considered 
equitable  property  rights,  but  which  some  believe  to  have 
little  or  no  foundation  in  equity.  As  already  stated,  I  do  not 
believe  this  would  be  the  case,  and  I  do  believe  that  it  is 
desirable  to  submit  to  the  peortle  all  important  questions  of 
public  policy,  which  in  their  own  interest  the  people  do  not 
prefer  to  have  decided  by  tlieir  representatives.  It  is  necessary 
to  use  common  sense  in  matters  of  government,  as  well  as  in 
other  things.  There  is  no  more  exacting  task  than  the  exercise 
of  wise  statesmanship,  nor  any  other  which  requires  so  long 
and  careful  preparation.  That  our  people  are  competent  to 
govern  themselves  wisely  in  all  matters  I  do  not  doubt,  but  in 
order  to  do  so  they  could  hardly  do  anything  else.  The 
voters  of  Athens  attended  to  very  little  serious  work  exce[)t 
politics,  but  then  the  freemen  of  the  city  had  a  plenty  of 
slaves  to  support  them,  while  we  have  not.  For  the  most  part 
the  voters  of  these  times  have  to  earn  their  own  bread  and 
butter,  which  most  of  us  find  a  quite  sufficient  task  upon  our 
energies,  and  we  are  glad  to  commit  the  making  and  the 
execution  of  laws  to  representatives  who  are  paid  to  attend  to 
27 


418  THE    QUESTIONS    OF    THE    DAY. 

it.     So  far  as  the  demand  for  direct  legislation  is  founded  on  a 
belief  of  the  general  venality  of  representatives,  I  believe  that, 
outside  of  the  large  cities,  it  is  on   a   mistaken   foundation. 
Nearly   all   legislators   are  honest  most  of  the  time— being 
swayed   by  venal   motives  only  in   special   matters,  and  the 
majority  are  honest  all  the  time.     But  the  judgments  of  honest 
men  will  often  differ,  and  in  such  cases  a  small  minority  of 
dishonest  men,  having  the  balance  of  power,  can  work  their 
will  for  reward.     Aside,  however,  from  the  governing  bodies 
of  large  cities,  I  doubt  whether  any  measure  ever  became  a 
law  which  was  not  approved  by  the  honest  judgment  of  the 
majority  who  voted  for  it.     In  the  main,  too,  I  believe  that 
the  action   of  our   legislative   bodies   reflects  fairly  well   the 
wishes  of  the  majority  of  voters  for  the  time  being.     The  use 
of  direct  legislation— which  is  exceedingly  expensive — should 
therefore   be  restricted  to  occasions  in  which  a  minority  of 
dishonest   representatives,   having  a   balance  of   power,  or  a 
strongly  partisan  Legislature  by  party  vote,  may  be  likely  to 
enact  measures  which  the  people  would  not  approve.     As  a 
"  question  of  the  day,"  therefore,  the  subject  of  direct  legisla- 
tion  is   hardly   ripe   for   discussion,  because   its   responsible 
advocates  have  not   yet  defined  the  occasions  to  which  they 
would   apply  it.     To   be  in  favor  of  the  "  initiative  and  the 
referendum  "  expresses  no  desire  which  one  can  put  his  finger 
on.      It  may  mean  something  which  we   should   nearly  all 
approve,  or  something  to  which  we  should  nearly  all  object. 
The  people  as  a  body  can  not  concern  itself  with  trifles.     It 
can  not  make  war  and  peace,  as  the  old  Germanic  tribes  used 
to,  because  a  modern  war  is  likely  to  begin  and  end  before  the 
people  could  get  ready  to  vote.     I  am  writing  during  the  war 
with  Spain,  at  a  time  when  our  navy  has  effected  a  lodgment 
on  the  Philippine  Islands,  and  when  the  public  is  discussing 
the   policy  of  conquering  and  keeping  them.      That,  or  the 
acquisition  of  any  foreign  territory,  except  mere  coaling  sta 
tions,  would  be  eminently  a  proper  question  to  be  submitted 
to  the  people.     The  policy  of  occupying  them  as  an  act  of  war 
is  evidently  not  a  question  which  the  people  would  wish  to 
decide  for  themselves.     There  are   certain   exigencies  in  life 


THE    FARMER    AND    THE    REFERENDUM.  419 

in  which  we  must  trust  others.  By  far  the  greater  part  of  the 
commercial  business  of  the  world  is  necessarily  transacted  by 
trusted  men  for  others.  The  greater  part  of  the  political  busi- 
ness must  be  transacted  in  the  same  manner.  On  certain 
important  occasions  it  is,  I  believe,  extremely  desirable  that 
even  national  questions  should  be  submitted  to  the  direct 
vote  of  the  people.  They  must,  however,  necessarily  be  such 
questions  as  will  admit  of  long  discussion,  enabling  all  infor- 
mation upon  which  representatives  could  act,  to  permeate  the 
entire  mass  of  the  people.  The  educational  result  of  such  a 
discussion  would  well  repa}''  its  enormous  cost.  In  matters  of 
state  policy  suitable  occasions  would  arise  more  frequently,  as 
people  are  better  informed  as  to  conditions  affecting  their 
own  state  than  they  can  be  of  conditions  affecting  the  whole 
nation. 

It  will,  for  a  long  time,  however,  be  essential  to  limit  the 
number  of  questions  to  be  submitted  at  the  same  time  to  one, 
or  at  most  two.  Nobody  who  has  ever  noted  the  voting  on 
several  constitutional  amendments  at  one  time,  will  believe 
that  tiie  public  has  yet  acquired  the  intellectual  vigor  to  ade- 
quately consider  more  than  one  question  of  state  policy  at  one 
time.  There  is  never  time  to  do  so,  in  addition  to  earning  a 
living,  during  the  period  for  which  such  subjects  are  usually 
before  the  people.  Neither  can  the  mass  of  the  people  be  in- 
duced not  to  subordinate  questions  of  principle  to  the  election 
of  candidates  in  whom  they  have  become  interested.  I  have 
seen  honest  fiirmers  spend  days  in  canvassing,  without  reward, 
for  the  success  of  an  officer  having  power  to  vote  on  the  taxa- 
tion of  a  county,  who  would  not  spend  an  hour  in  the  study 
of  a  constitutional  amendment  modifying  the  policy  of  the 
entire  state,  and  to  be  voted  u[)on  at  the  same  election. 
Obviously,  then,  the  exercise  of  direct  legislation  should  be 
restricted  to  really  important  subjects,  and  submitted  at  elec- 
tions when  no  other  question  is  pending.  AVlieu  the  people 
really  take  bold  of  a  subject  and  master  it,  they  will  decide  it 
rightly.  They  can  not  be  got  to  do  this  very  often  because 
they  have  to  live,  and  feel  that  they  can  best  afford  to  get  on 
with  such  legislation  as  is  given  them  by  the  representatives 
of  their  choice. 


420  THE    QUESTIONS    OF    THE    DAY. 

As  we  come  down  to  municipal  affairs  the  same  considera- 
tions apply,  but  in  a  less  degree,  because  people  know  more 
about  the  cities  they  live  in  than  about  their  state  or  nation. 
A  wholesome  check  on  modern  city  governments  is  undoubt- 
edly a  thing  to  be  desired.  Within  reason,  and  properly 
guarded  by  the  people  themselves,  so  as  to  avoid  being 
compelled,  by  a  small  body  of  agitators,  to  vote  on  proposals 
which  they  do  not  desire  to  discuss,  the  more  direct  legislation 
by  the  people  there  can  be  in  American  municipalities,  the 
better  off  they  will  probably  be.  There  need  be  no  fear  of 
hasty  legislation  by  the  people,  or  of  unwise  legislation  ujxjn 
questions  upon  which  they  have  informed  themselves. 

There  is  one  country  in  the  world  where  both  the  initiative 
and  the  referendum  are  firmly  established.  Since  1874  the 
people  of  Switzerland  have  been  able  to  compel  the  submis- 
sion of  all  federal  laws,  unless  formally  declared  to  be  of  an 
"urgent"  nature,  to  be  submitted  to  the  direct  vote  of  the 
people.  To  secure  this,  as  a  matter  of  right,  there  must  be  a 
petition  signed  by  thirty  thousand  voters,  or  by  the  authorities 
of  eight  cantons,  which  must  be  presented  -\;^uthin  ninety  days 
of  the  adoption  of  the  lavr  by  the  Federal  Legislature.  Until 
after  the  expiration  of  the  ninety  days  allowed  for  petition,  a 
law  does  not  become  in  force.  The  exception,  as  stated,  is  a 
case  of  "urgency."  Laws,  when  thns  submitted  as  the  result 
of  petition,  are  passed  by  a  majority  of  those  voting. 

In  addition  to  this  provision  for  submitting  to  the  people, 
upon  proper  demand,  all  laws  passed  by  the  Federal  Legis- 
lature, there  is  an  additional  provision,  whereby  upon  petition 
of  fifty  thousand  citizens,  new  laws,  not  acted  upon  by  the 
Legislature,  may  be  submitted.  In  this  case  the  draft  of  the 
proposed  statute  is  included  in  the  petition,  upon  receipt  and 
verification  of  which  the  Legislature  must  submit  it  to  the 
people.  It  may,  at  the  same  time,  if  it  see  fit,  submit  a  differ- 
ent law  of  its  own,  covering  tlie  same  subject,  but  the  people 
decide.  The  above  refers  to  the  Federal  Government.  Many 
and  perhaps  all  the  cantons  have  similar  methods  of  employ- 
ing both  the  initiative  and  the  referendum.  The  universal 
testimony  is  that  tlie  workings  of  the  law  are  satisfactory.     It 


THli    FARMER    AND    THE   REFERENDUM.  421 

must  be  remembered,  however,  that  Switzerland  is  a  small 
country  with  a  population  native  to  the  soil,  and  familiar  with 
its  history  and  traditions.  Its  neutrality  in  time  of  war  being 
guaranteed  by  the  great  powers  of  Europe,  it  has  no  very 
perplexing  questions  of  foreign  policy,  and  is  able  to  devote 
its  entire  iiseal  energies  to  administration  and  improvements, 
as  to  which  the  peo})le  are  well  informed.*  The  trouble  in 
the  United  States  would  arise  from  the  concentration  in  certain 
localities  of  large  numbers  of  races  not  well  qualified  for  self- 
government  and  whose  unsettled  and  revolutionary  ideas 
would  make  much  trouble  for  our  native  people.  They  are 
not  strong  enough,  however,  to  do  much  harm.  The  Amer- 
ican race  is  sensible  and  sturdy,  and  will  have  its  way. 


*It  is  also  stated  that  one  very  strong  reason  for  the  establishment  of 
the  referendum  in  Switzerland  is  the  fact  that,  although  that  country  has  a 
constitution,  it  has  no  Supreme  Court  authorized  to  declare  laws  unconstitu- 
tional and  void.  There  being,  therefore,  no  check  upon  the  Legislature  except 
its  own  sense  <of  duty  to  obey  the  Constitution,  and  no  means  of  preventing 
the  enforcement  of  unconstitutional  laws,  should  any  such  be  enacted,  the 
referendum  became  an  essential  security  for  the  enforcement  of  the  will  of  the 
people.  " 


CHAPTER    VIII. 

THE    FARMER   AND    SOCIALISM. 

WE  may  agree  in  desiring  that  our  great  industrial 
activities  be  directed  by  persons  of  brains  and  force, 
and  concede  that  to  the  possessors  of  those  qualities 
something  more  is  due  from  society  than  to  those  who  are 
without  them,  and  yet  we  may  protest  against  the  tyranny  of 
intellect  and  vigor  which  now  oppresses  us,  and  insist  that  we 
who  pay  tribute  to  those  virtues  have  more  voice  in  fixing  its 
amount.  We  may  concede  that  the  mighty  forces  which  impel 
mankind  to  its  destiny  will  move  on  in  the  line  of  their 
resultant,  regardless  of  our  views  or  wishes,  and  yet  recognize 
that  all  that  we  say  or  do  is  both  an  effect  and  a  part  of  those 
forces,  and  that  discussion  of  social  reform  is  therefore  not 
vain  or  unprofitable.  Insomuch  as  opinion  is  changed,  desire 
is  changed,  and  a  change  of  desire  in  a  single  human  being- 
tends  to  a  change  in  the  direction  of  social  impulse.  With  no 
pretense  to  deep  reading  on  social  topics,  I  seem  to  myself 
sufficiently  familiar  with  the  literature  of  the  subject  to  feel 
justified  in  saying  that  the  subject  of  social  reform  has  hardly 
yet  been  touched — at  least  by  English-speaking  peoples — in 
any  thoughtful  way,  from  the  standpoint  of  the  interest  which 
will  liave  to  be  first  considered  in  any  new  alignment  of  the 
social  battalions.  Discussion  seems  to  have  centered  itself 
almost  wholly  about  urban  life  and  the  comfort  of  operatives. 
But  before  there  can  be  urban  life  there  must  be  food  to  sustain 
it,  and  before  factories  can  be  operated  there  must  be  raw 
material.  For  many  ages  mankind  demonstrated  its  power  to 
live  without  cities  and  without  factories,  and  it  could  do  so 
still,  but  the  results  of  labor  of  rural  society  are  essential  to 
our  existence.  The  conveniences  and  ornament  of  a  structure 
may  be  more  in  evidence  than  the  foundations,  but  it  is  the 
strength  and  disposition  of  the  latter  which  control  stability. 

(422) 


THE    FARMER    AND    SOCIALISM.  423 

If  societ}'  is  to  be  reconstructed — which  I  neither  affirm  nor 
deny — the  reconstruction  must  begin  with  the  foundation, 
which  is  in  rural  Hfe.  It  is  true  that  without  forethought 
alterations  in  the  superstructure  may  happen  to  so  conform  to 
the  foundation  that  the  edifice  may  remain  stable,  but  such  is 
not  likely  to  be  the  case,  nor  would  any  good  architect  take 
it  for  granted.  It  does  not  seem  to  me  to  be  the  case  with 
respect  to  the  alterations  in  society  which  have  been  planned 
by  urban  residents  and  artisans.  The  farmer  has  not  been 
called  into  consultation,  and  yet  he  will  not  only  have  some- 
thing to  say,  but  will  have  the  controlling  voice.  Without 
his  aid  there  can  be  no  reconstruction  of  society  except  by  the 
slow  processes  of  natural  growth.  It  may  be  worth  while  to 
hear  something  from  the  class  that  will  decide. 

I  am  myself  a  farmer,  with  rural  education,  tastes,  interests 
and  prejudices,  but  I  am  also  not  unacquainted  with  urban 
conditions  and  social  movements  there,  indeed,  having  of  such 
knowledge,  as  I  think,  a  better  store  than  they  have  of  rural 
conditions  who  are  best  known  as  proponents  of  social  recon- 
struction. My  animus  is  that  I  heartily  desire  most,  if  not 
all,  the  ultimate  ends  proposed  by  abstract  Socialism,  which  I 
understand  to  be  a  perfectly  just  distribution  of  comfort.  If, 
therefore,  I  am  a  critic  of  Socialism  I  am  a  friendly  critic,  my 
objections  to  its  program  being  mainly  a  conviction  that  it 
would  not  remove  but  intensify  the  evils  which  it  is  intended 
to  mitigate. 

Abstract  Socialism  rests  on  three  distinct  propositions: 
First,  no  special  reward  is  due  from  society  to  the  possessors  of 
great  foresight,  or  organizing  ability,  or  executive  vigor; 
(Second,  the  man  who  saves  is  entitled  to  use  his  savings, 
(but  to  no  payment  for  their  use  by  others;  tliird,  no  man  is 
entitled  to  ownership  of  land  or  any  other  part  of  nature, 
and  especially  to  increment  thereon  unearned  by  himself. 
As  it  is  only  from  these  sources  that  capital,  in  the  modern 
jsense,  can  be  derived,  there  follows  the  corollary  that  "capital 
'is  robbery." 

The  demands  of  Socialism  are  more  commonly  stated  as 
follows : — 


424  THE   QUESTIONS   OF   THE  DAY. 

State  control  of  all  gifts  of  nature,  including  the  earth  unci 
everything  which  it  produces.  No  private  ownership  recog- 
nized in  anything  not  the  product  of  the  labor  of  the  producer. 

State  control  and  operation  of  all  instruments  of  produc- 
tion, including  f^ictories  and  machinery.  I  do  not  understand 
tills  to  include  such  implements  as  individuals  might  requiie 
in  their  daily  labor  for  themselves,  but  between  these  and  tlie 
large  plants  which  the  state  would  own  and  operate,  there  is 
no  closely  drawn  line. 

State  or  municipal  control  and  operation  of  all  public 
means  of  transportation. 

State  or  municipal  control  and  operation  of  all  public  util- 
ities, including  street  railways,  telegraphs,  telephones,  water 
and  ligl)ting  plants,  and  the  like. 

The  above  are  the  essential  fundamental  doctrines  held  by 
all  true  Socialists,  In  minor  points  there  are  differences  more 
or  less  wide  between  different  "schools."  The  platform  of  the 
"Socialist  Labor  party"  differs  from  true  Socialism  in  not 
excluding  private  ownership  of  land  and  instruments  of  pro- 
duction, or  the  "exploitation"  of  labor. 

The  ranks  of  Socialism  include  many  most  excellent  men. 
While  I  am  not  a  Socialist,  I  recognize  that  it  is  a  movement 
not  to  be  slightly  reckoned  with,  or  its  arguments  to  be  hastily 
put  aside.  It  is  making  progress,  in  America,  among  the 
more  emotional  of  the  intellectual  classes  who  contribute  to  the 
already  enormous  volume  of  Socialistic  literature,  and  among 
the  best  class  of  artisans  who  look  to  it  as  promising  relief 
from  intolerable  burdens,  and  who  supply  the  numbers  at 
Socialist  gatherings. 

There    is  implied  in  all  Socialistic  writing*  the  doctrine 


*In  the  present  stage  of  discussion  upon  social  questions  the  issues  are 
badly  mixed,  and  individuals  who  profoundly  disagree  upon  fundamental  doc- 
trine are  found  heartily  working  together  for  the  accomplishment  of  immediate 
ends.  Trade  unionism  is  almost  contradictory  to  Socialism,  and  yet  Socialists 
are  always  found  hand  in  hand  with  organized  labor.  The  public  ownership  of 
public  utilities  is  an  essential  part  of  the  Socialistic  program,  which  is  accepted 
by  great  masses  of  men  who  are  strongly  opposed  to  its  more  radical  demands. 
A  great  number,  also,  who  are  not  Socialists,  favor  the  nationalization  of  rail- 


THE    FARMER    AND    SOCIALISM.  425 

that  organized  man  can  override,  and,  as  applied  to  himself, 
repeal  the  fundamental  law  of  nature  that  no  species  can 
endure,  except  by  the  production  of  more  individuals  than 
can  be  supported,  of  whom  the  weakest  must  die,  with  the 
corollary  of  misery  before  death.  Competitive  society  tends 
to  the  death  of  the  weakest;  Socialistic  society  would  tend  to 
the  preservation  of  the  weak. 

There  can  be  no  question  of  the  grandeur  of  this  concep- 
tion. To  no  man  is  given  nobler  aspirations  than  to  him  who 
conceives  of  a  just  distribution  of  comfort  in  an  existence  not 
idle,  but  without  struggle.  It  would  be  a  Nirvana  glorious 
only  in  the  absence  of  sorrow,  but  still  perhaps  a  happy  ending 
for  our  race.  It  may,  after  all,  be  our  destiny.  Nor  can  any 
right-minded  man  forbear  his  tribute  to  the  good  which 
Socialistic  agitation  has  done.  No  man  can  tell  how  much 
misery  it  has  prevented  or  how  much  it  will  prevent.  So, 
also,  while  we  may  regret  the  emotionalism  which  renders 
even  so  keen  an  intellect  as  that  of  Karl  Marx  an  unsafe 
guide,  w^e  must,  when  we  read  his  descriptions  of  conditions 
for  which  he  sought  remedy,  confess  that  he  had  been  less  a 
man  had  he  been  less  emotional.  The  man  whom  daily  con- 
tact with  remediable  misery  will  not  render  incompetent  to 
always  write  logically  is  not  one  whom  I  should  wish  to  know. 
But  it  is  the  mission  of  such  men  to  arouse  action,  and  not  to 
finally  determine  its  scope.  The  advocate  may  not  be  the 
judge. 

Recurring  to  the  fundamental  principles  of  Socialism,  as 
stated  on  page  423 — and   I   may  say   that   disregarding  the 


roads.  There  are  multitudes  of  non-Socialists  who  favor  nationalization  of  water, 
which  is  Socialistic  doctrine,  who  are  strong  supporters  of  private  ownership  in 
land.  In  regard  to  land  single  taxers  and  Socialists  have  many  more  points  of 
agreement  than  of  divergence.  No  program  could  command  the  support  of  the 
multitude  of  earnest  men  who  are  found  in  the  ranks  of  Socialism  which  did  not 
contain  a  great  deal  of  good,  but  the  supporters  of  some  one  or  more  of  the 
demands  of  Socialism  may  be  very  far  from  being  Socialists.  To  be  a  Socialist 
one  must  favor  the  abolition  of  profit  and  interest,  state  ownership  of  all  gifts  of 
nature,  of  all  means  of  production,  and  of  all  public  utilities,  and  of  such 
control,  by  the  state,  of  individual  life  and  effort  as  shall  be  ultimately  found 
essential  to  the  accomplishment  of  the  ends  of  Socialism. 


426  THE    QUESTIONS    OF    THE    DAY. 

numberless  schools  into  which  those  who  call  themselves 
Socialists  are  constantly  dividing,  I  follow  Karl  Marx— I 
suppose  they  are  to  be  met  in  this  way:  the  first  we  should 
deny  on  the  ground  that  great  ability  is  the  gift  of  nature  to 
the  individual  and  not  to  the  race,  and  that  the  individual  is 
entitled  to  the  reward  which  it  brings,  and  that  therefore  one 
day's  work  is  not  like  all  other  days'  works,  as  Marx  holds, 
with  the  value  of  the  average  as  the  measure  of  payment,  but 
the  work  of  the  exceptionally  able  is  entitled  to  extra  pay- 
ment; that  society  needs  this  work,  can  afford  to  pay  for  it, 
and  will  gain  a  greater  aggregate  of  satisfactions  for  general 
distribution  if  it  is  paid  for.  We  should,  however,  agree  that 
society  is  not  bound  to  pay  the  possessor  of  exceptional 
qualities  his  own  price  for  their  use,  and  that  we  are  prepared 
to  join  in  such  measures  as  shall  assure  the  use  of  ability  at 
a  fair  compensation.  The  second  we  should  also  deny  on  the 
ground  that  industry  and  prudence  are  entitled  to  reward; 
that  often  this  can  be  given  only  in  the  form  of  interest;  and 
that  society  can  afford  to  and  justly  should  pay  interest  for 
the  use  of  savings.  If  a  man  builds  a  mill,  and,  falling  sick, 
can  not  use  it,  those  who  do  use  it  should  pay  him  interest;  so, 
also,  if  he  has  saved  the  money  to  build  a  mill ;  and,  still 
further,  if,  having  worked,  he  now  chooses  to  rest.  We  would 
further  insist  that  if  he  uses  the  mill,  and  so  takes  the  risk  of 
production,  he  is  entitled  to  what  will  pay  for  the  risk,  in 
addition  to  the  interest  which  he  might  have  had  without 
risk,  in  other  words,  to  profit.  There  is  no  objection,  however, 
as  to  some  classes  of  enterprises,  for  the  state  to  regulate  profit 
upon  the  basis  of  corresponding  guarantee  against  loss.  Profit 
is  the  pay  for  risk.  Socialism  proposes  that  the  state  shall 
assume  risk  and  abolish  profit.  We  are  convinced  that  such 
a  course  would  result  in  a  diminution  of  divisible  satisfactions. 
To  the  third  proposition  we  should  heartily  assent.  No 
wise  man  will  now  attempt  to  defend  private  ownership  of 
land  or  water  as  a  natural  right.  It  is  often  based,  in  old 
countries,  on  ancient  plunder  of  the  weak  by  the  strong.  In 
new  countries,  however,  where  the  state  was  once  in  as  full 
possession  as  any  Socialist  could  desire,  private  ownership  is 


THE    FARMER    AXD    SOCIALISM.  427 

based  on  the  faith  of  the  state  which  conveyed  its  title  to  the 
individual.  In  old  countries  the  state  has  condoned  the  orig- 
inal robbery,  just  as  it  has  condoned  the  robbery  of  all  unearned 
increment,  and  upon  the  faith  of  the  state's  guaranty  those  who 
have  saved  have  invested  their  savings.  It  is  right  that  this 
faith  should  be  respected,  just  as  it  is  right  that  national  debts 
shall  be  honestly  paid,  not  because  one  generation  is  bound  by 
the  engagements  of  former  generations,  but  because  it  is  for 
the  good  of  all  generations  that  they  should  consider  them- 
selves so  bound.  All  this  Socialism  denies.  But,  regardless 
of  ethics,  and  if  the  unquestioned  title  to  all  land  now  rested 
in  the  state,  we  should  favor  its  alienation  to  individuals,  and 
ccmsequent  private  ownership  of  land  upon  the  ground  of 
expediency,  because  land  will  yield  more  to  private  owner- 
ship than  to  the  ownership  of  the  public,  and  it  is  desirable 
that  the  most  be  made  of  it.  But,  while  thus  disputing,  in 
})art,  the  validity,  and  absolutely  the  wisdom  of  this  Socialistic 
contention,  we  should  be  prepared  to  join  heartily  in  the  pro- 
motion of  all  measures  for  assuring  to  the  public  all  future 
increment  of  value  unearned  by  individuals. 

But  it  is  not  with  regard  to  abstract  but  concrete  Socialism, 
as  advocated  by  its  votaries  of  to-day,  that  I  wish  to  write. 
This,  as  I  have  said,  centers  about  urban  life  and  the  welfare 
of  artisans,  inevitably  so,  because  there  only  is  there  a  suffi- 
cient concentration  of  those  for  whose  labor  there  is  insufficient 
market,  and  also,  as  is  claimed,  logically,  because  the  needs  of 
that  class  must  be  the  basis  of  the  standard  of  life.  It  is  this 
contention  of  these  societies  that  I  wish  specially  to  traverse. 
I  deny  that,  assuming  a  uniform  basic  standard  of  life,  the 
needs  of  the  urban  resident  must  be  the  standard,  and  assert 
that,  on  the  contrary,  it  must  be  the  needs  of  the  farmer. 

Concrete  Socialism  is  in  some  respects  exemplified  in  trade 
unionism,  meaning  by  that  expression  the  aggregate  of  the 
demands  of  organized  labor.  It  does  not  profess  to  be 
Socialism,  and  it  may  be  that  the  majority  of  those  belonging 
to  these  organizations  would  not  call  themselves  Socialists. 
Their  objects,  however,  it  is  safe  to  say,  have  the  hearty 
approval    of    all   Socialists,    as    a    stepping-stone   to    further 


428  THE    QUESTIONS    OF    THE    DAY. 

demands,  and  form  one  of  the  very  few  concrete  propositions 
upon  which  substantially  all  agitators  for  social  reconstruction 
unite.  Trade  unionism  practically  seeks  to  control  all  instru- 
ments of  production.  It  does  not,  like  Socialism,  demand  the 
title  to  the  property,  but  does,  in  large  measure,  demand  con- 
trol of  its  management,  while  assuming  no  risk.  It  does  not 
seek  to  abolish  employers,  but  to  control  them.  The  object 
of  the  control  which  is  sought  is  to  secure  shorter  hours  with 
undiminished  wages  for  those  within  the  union,  and  to  prevent 
those  not  belonging  to  a  union  from  securing  work,  while 
making  the  privilege  of  membership  in  the  union  dependent 
upon  the  ballot  of  those  already  in.  While  this  is  not 
Socialism,  it  is  a  program  favored  by  Socialists  as  a  step 
towards  its  ultimate  ends,  in  return  for  which  trade  unionism 
supplies  the  force  which  alone  gives  power  to  the  Socialistic 
movement  in  America,  and  without  which  Socialism  here 
would  be  but  a  vague  dream  of  enthusiasts  who  conceive 
what  could  be  done  by  a  race  of  perfect  beings,  and  imagine 
that  mankind  can  do  the  same.  The  only  present  concrete 
Socialism  is  therefore  trade  unionism,  whose  demands  Social- 
ists almost  unanimously  support,  and  which  must  therefore  be 
accepted  as  a  part  of  the  immediate  program  of  Socialism. 
The  effect  of  Socialistic  trade  unionism  is  to  raise  the  price  of 
what  farmers  have  to  buy  with  no  provision  for  correspond- 
ingly raising  the  price  of  wliat  they  have  to  sell,  and  must, 
therefore,  be  obnoxious  to  farmers. 

I  wish  to  say  here  that  I  wish  to  see  labor  equally  divided, 
and  comfort  distributed  according  to  desert;  and,  above  all 
things,  I  favor  organization  of  all  classes  to  deal  with  all  other 
classes,  this  being  cooperation  as  opposed  to  Socialism,  whose 
end  is  the  extinction  of  class.  I  therefore  favor  trusts,  trade 
unions,  business  organizations  of  farmers,  banks  and  associa- 
tions of  banks,  mercantile  combinations,  cooperative  stores, 
cooperative  loan  associations,  consolidation  of  transportation 
companies — anything  which  tends  to  stop  bickering,  and  bring 
together  those  of  common  interests  whose  representatives  may 
deal  and  compromise  with  those  of  adverse  interests,  in  the 
light  of  full  information  and  under  a  sense  of  responsibility, 


THE   FARMER   AND   SOCIALISM.  420 

with  the  pledge  of  the  whole  that  negotiations  shall  proceed 
decently  and  in  order,  and  with  the  power  of  the  whole  inter- 
posed as  a  last  resort.  But  as  a  farmer  I  object  to  a  program 
involving  as  its  first  step  an  act  of  injustice  to  me,  and  having 
its  ultimate  end  based  on  the  fallacy  that  the  interests  of  man- 
kind are,  or  can  become,  identical,  or  that  individuals  and 
classes  will  ever  cease  to  seek  their  own  advantage  as  opposed 
to  that  of  others,  when,  as  a  matter  of  fact,  human  interests 
will  always  be  diverse,  and  individuals  and  classes  will  always 
seek  to  accomplish  their  own  ends.  No  one  can  deny  this  to 
be  a  just  position  for  farmers  to  take,  or  that  it  has  the 
support  of  the  farmers  generally.  Their  numbers  are  and 
always  will  be  sufficient  to  prevent  reconstruction  of  society 
on  irrational  grounds,  and  their  strong  common  sense,  unim- 
paired by  daily  contact  with  enthusiasts,  will  not  fail  to  detect 
the  fallacies  which  lie  at  the  bottom  of  Socialism.  It  is  not 
on  such  lines  that  society  can  be  reconstructed. 

The  ownership  of  ordinary  land  is  mainly  valuable  to  the 
farmer  in  that  it  gives  him  steady  work  whereby,  if  he  directs 
his  work  well,  he  may  obtain  a  livelihood.  It  is  the  improve- 
ments on  land  which  usually  give  it  value,  and  these  represent 
the  savings  of  individuals.  The  improved  lands  of  the  world 
almost  certainly  could  not  be  valued  at  what  the  improvements 
have  cost,  or  sold  for  what  it  would  cost  to  replace  them.  The 
farmer  of  moderate  means  is  simply  a  laborer  with  the  use  of 
somebody's  savings  invested  in  improvements,  and  the  guar- 
anty of  steady  work  at  small  pay  so  long  as  he  makes  no  seri- 
ous mistake.  Money  paid  for  farm  land  or  its  use  is  usually 
simply  a  bi)nus  })aid  in  advance  for  a  steady  job.  In  so  far 
as  value  has  been  given  to  land  by  improvements  for  which 
the  ownev  did  not  pay,  he  was  not  entitled  to  it  and  should 
never  have  received  it,  any  more  than  the  owner  of  a  city  lot 
sliould  have  received  the  increment  caused  by  the  movement 
of  population.  Any  method  which  for  the  future  may  conserve 
such  increment  for  the  general  benefit  of  society,  should  receive 
the  support  not  only  of  farmers,  but  of  all  men,  and  would 
receive  tliat  of  a  vast  majority.  AVliat  has  been  sequestrated 
in  times  past,  of  this  increment,  is   something  lost,  which, 


430  THE    QUESTIONS    OF    THE    DAY. 

doubtless,  society  has  the  moral  right  to  recover  from  the 
hands  of  him  who  first  received  it,  but  not  from  those  to 
whom,  with  the  sanction  of  society,  he  has  transferred  it.  It 
is  not,  outside  large  cities,  an  important  factor,  and  both  in 
city  and  country  is  in  many  cases  being  eliminated  by  the 
movements  of  the  society  which  created  it.  Even  if  it  were 
not  so  it  would  not  pay  to  break  up  society  to  reclaim  what 
the  work  of  a  short  time  would  pay  for,  nor  could  it  be 
reclaimed  to  society  by  such  reconstruction  as  is  proposed;  it 
would  go  to  the  class  of  men  who  now  manage  our  smaller 
politics,  and  who  would  find  their  golden  opportunity  in  the 
Socialistic  state. 

The  farmer,  then,  is  a  laborer;  more  than  that,  he  is  one 
who  can  by  no  means  work  short  hours.  His  manner  of  life 
is  determined  by  the  elements.  He  takes  the  risks  of  pro- 
duction, and  is  entitled  to  its  rewards,  whicli,  upon  the  aver- 
age, he  does  not  get,  and  will  not,  this  being  the  compensation 
which  he  must  pay  for  his  reasonable  security  of  a  livelihood 
If  he  is  an  employer,  his  income  is  as  frequently  less  than  that 
of  his  employees  as  above  it.  He  can  not,  and  in  the  nature 
of  his  occupation  never  can  have,  a  four-hour,  or  a  six-hour, 
or  an  eight-hour  day.*  He  must  make  hay  when  the  sun 
shines,  and  morning  and  evening  must  tend  his  stock.  Of 
rainy  days  he  must  mend  harness  in  the  barn,  or  pare  ai)ples 
in  the  kitchen.  Nor  does  he  or  any  other  human  being  need, 
or,  if  a  normal  man,  desire,  the  short  day,  nor  will  he  be  con- 
tent with  it  if  he  can  avoid  it,  or  be  happier  if  he  had  it.  The 
plea  that  many  hours  a  day  are  required  for  "  culture"  is  a 
fallacy.  None  but  minds  long  trained  can  devote  much  time 
to  serious  study,  nor  will  they  try.  They  will  play  pedro  in 
tiie  groceries,  or  worse.  The  habit  of  idleness  is  one  of  tlic 
easiest  to  acquire.  Nor  is  the  short  day  necessary  or  desirable, 
(h'eat  learning  gives  no  more  assurance  of  happiness  than 
great  wealth.  If  let  alone,  those  who  have  aptitude  that  way 
will  choose  learning  for  their  avocation,  and  the  rest  of  us  can 
accept  the  results.     With  a  twelve-hour  day,  not  all  the  time 


*8ee  Chapter  VI  of  Book  Tliird. 


THE    FARMER    AND    SOCIALISM.  431 

at  severe  labor,  there  is  still  ample  time  for  such  "improve 
ment"  as  we  are  capable  of  absorbing,  and  such  recreation  as 
is  healthful  and  really  enjoyable.  The  normal  man  gets  his 
best  recreation  in  forwarding  bu.siness  for  his  individual  wel 
fare  within  the  limits  of  his  strength.  It  is  not  in  the  line  of 
progress,  but  of  retrogression,  to  reduce  the  hours  of  work 
beyond  reason,  and  thereby  the  aggregate  of  divisible  satis- 
factions, nor  will  it  promote  happiness  to  apply  work  to  the 
general  rather  than  individual  welfare. 

At  any  rate,  the  farmer  can  not  so  live,  because  unalterable 
natural  conditions  compel  him  to  live  otherwise.  What 
Socialists  term  ca|)italistic  methods  do  not  lend  themselves 
readily  to  the  cultivation  of  land.  They  are  now  seldom 
protitable,  and  only  under  exceptional  conditions,  which,  even 
where  they  exist,  can  not  be  lasting.  The  use  of  machinery 
quickly  finds  its  limit  in  the  inequalities  of  land,  the  cost  of 
powder,  and  the  expense  of  wear  and  tear.  So  long  as  there 
is  surplus  power  in  self-repairing  human  beings,  who  must  in 
any  case  be  fed,  and  so  long  as  plants  and  animals  have  indi- 
vidual peculiarities,  which  must  be  considered,  but  of  which 
machinery  takes  no  account,  it  will  not  be  economical  to 
dispense  with  human  and  animal  labor  for  the  majority  of 
agricultural  operations,  even  if  inventive  genius  could  devise 
the  machines.  Those  who  write  most  glibly  about  machine 
cultivation  of  farms  seem  unfamiliar  with  the  operation  of  the 
economic  law  of  diminishing  returns,  and  do  not  realize  that 
most  land  is  rough,  and  that  power  costs  money,  and  its  use 
requires  mechanical  skill  and  convenient  repair  shops.  That 
the  aggregate  of  the  use  of  machinery  in  agricultural  opera- 
tions will  increase,  there  can  be  no  doubt,  but,  relatively,  it 
must  decrease  with  the  increase  of  population.  So  long  as 
land  shall  be  cultivated,  its  economic  use  will  require  work 
days  of  long  hours,  and  economic  rent  will  tend  to  be  absorl)ed 
by  the  requirements  of  labor  until  it  is  no  longer  a  factor 
in  the  farmer's  income — a  condition  which  it  has  long  since 
reached  in  many  lands — and  in  this  way  all  value  that  has 
temporarily  and  unjustly  been  appropriated  by  individuals 
will  gradually  be  reappropriated  by  society,  and  that  not  by 


432  THE    QUESTIONS   OF    THE    DAY. 

the  reconstruction  of  society,  but  by  its  development  on  natural 
lines.  Towards  this  end  it  would  not  be  impossible  to  con- 
struct an  affirmative  program,  doubtless  involving  changes 
almost  fundamental  in  our  conceptions  of  some  property  rights, 
and  therefore  involving  changes  in  fundamental  law,  but  still 
based  upon  sound  economic  and  ethical  principles,  and  with 
due  recognition  of  the  infirmities  of  human  nature.  It  would 
deal,  among  other  things,  with  the  subjects  of  inheritance, 
conservation  of  unearned  increment,  acquirement  of  public 
utilities,  discouragement  of  the  use  of  long  credit,  and  similar 
methods  of  restricting  the  power  of  concentrated  capital.  Some 
thinker  will  evolve  such  a  plan,  and  some  leader  of  men  will 
take  it  up. 

In  the  meantime,  and  under  present  conditions,  since  the 
nature  and,  in  a  great  measure,  the  standard  of  the  farmer's 
life  is  irrevocably  fixed  by  his  natural  environment,  he 
denounces  as  unjust  and  impossible  any  reconstruction  of 
society  in  which  the  standard  of  life  which  he  is  compelled 
by  unchangeable  conditions  to  adopt,  shall  not  be  made  the 
basic  standard  whereto  the  lives  of  all  other  classes  shall  be 
adjusted.  He  objects  emphatically  to  any,  even  tenative,  pro- 
posals which  shall  compel  him  to  exchange,  against  his  will, 
more  than  one  day  of  his  labor  for  one  day's  work  of  him 
who  makes  his  shoes  or  builds  his  house.  He  denies  that  such 
reconstruction  is  just  or  necessary,  or  that  the  evils  of  crowded 
society  can  be  cured  in  that  way.  He  recognizes  those  evils  as 
well  as  those  with  which  he  is  himself  afflicted,  and  is  ready 
to  join  in  all  rational — even  if  radical — measures  for  allevi- 
ating them;  he  declares  that  such  measures  are  humanly 
possible,  and  can  be  formulated  along  the  lines  which  the 
evolution  of  civilization  has  always  followed,  and  that  he  will 
not  join  in  or  consent  to  a  program  in  which  the  first  step  is  an 
act  of  injustice  to  himself.  Personally,  I  suppose  that  things 
will  go  on  as  they  are  now  until  gradually  the  organization  of 
one  class  forces  counter-organization  in  self-defense,  and  that, 
last  of  all,  when  survival  without  organization  has  become 
impossible,  the  farmers  themselves  will  unite,  formulate  their 
demands,  present  them  for  the  consideration  of  other  classes, 


THE    FARMER    AND   SOCIALISM.  433 

and  finally  compromise  as  seems  just  to  all  interests.  But 
they  will  not  become  Socialists ;  for  agricultural  life  and  work 
can  not  be  carried  on  under  the  Socialistic  program,  or  any 
program  which  withdraws  the  stimulus  of  individual  reward 
for  individual  etibrt. 


28 


BOOK    SEVENTH, 

The  Fruit  Marketing  Societies 
of  California.* 


CHAPTER     I. 

THEIK    CHARACTER    AND    OBJECT. 

WHILE  the  object  of  this  volume  is  rather  a  study 
of  principles  than  a  record  of  events,  there  are 
some  peculiarities  attending  the  development  of 
cooperation  in  California  which  are  well  worth  the  study  of 
the  student  of  social  movements  ;  and  as  no  comprehensive 
description  of  the  California  societies,  or  of  those  similar  to 
them  in  other  states,  has  ever  been  published,  it  seems  desir- 
able to  include  a  brief  sketch  of  the  most  prominent  of  them 
here. 

It  is  obviously,  as  things  go,  an  easier  operation  to  buy 
than  to  sell,  and  to  save  than  to  gain,  for  there  is  required  less 
expenditure  of  vigor,  which,  in  the  main,  is  the  controlling 
element  in  human  performance.  That  which  is  easier  for  the 
individual  is  also  easier  for  an  organization,  and  a  French  writer 
on  cooperation,  therefore,  very  properly  remarks,  in  speaking 
of  the  French  agricultural  syndicates,  which  are,  in  the 
main,  cooperative  purchasing  societies,  that,  marketing  being 
the  highest  exercise  of  the  art  of  cooperation,  it  is  the  last 
function   which   he   expects   these   syndicates   to    undertake. 


■  See  Appendix  E  for  list  of  societies. 
(434) 


THEIR    CIIARACTKi;    AND    OIJ.IKIT.  1:55 

Cooperation  develops  in  each  country  accordiuf^  to  the  local 
necessities  of  that  country,  which  will  invariably  indicate  the 
line  of  least  resistance.  The  conditions  attending  fruit- 
growing in  California  have  been  such  that  the  cooperative 
element  among  fruit-growers  was  at  once  plunged  into  the 
most  difficult  of  all  cooperative  undertakings,  which  it  was 
compelled  to  attack  without  experience  in  cooperation,  and 
witii  little  or  no  knowledge  of  the  art  of  marketing.  The 
movement,  with  many  ups  and  downs,  has  proceeded  steadih- 
from  the  first,  the  co-operative  fruit*  sales  in  1898  having 
reached,  in  round  numbers,  the  sum  of  $5,000,000.  While  no 
one  can  safely  predict  its  immediate  future,  its  work  up  to  this 
time,  which  has  attracted  no  attention  from  any  writer  upon 
cooperative  afFairs,t  has  been  such  as  to  warrant  a  brief 
description. 

When  one  once  becomes  impressed  with  the  law  that 
necessity,  and  necessity  alone,  will  induce  cooperation,  and 
that  the  unit  of  cooperative  life  is  the  industry,  and  not  the 
locality,  it  at  once  becomes  interesting  to  note  and  compare 
the  spasmodic  outbreaks  of  the  movement  in  different  and 
distant  countries.  While  cooperation,  when  once  established, 
has  more  or  less  tendency  to  spread  from  established  centers, 
it  is,  after  all,  always  the  result  of  social  pressure,  and  is  sure 
to  appear  when  the  pressure  is  sufficient.  The  British  artisan 
suffered  under  the  oppression  of  the  retail  dealers  in  the 
necessities  of  life,  and  the  result  was  the  magnificent  svstem  of 


*I  do  not  include  cooperative  dairying,  for  the  reason  that,  with  a  good 
deal  of  effort,  no  one  has  ever  been  able  to  gather  statistics  whic'-  are  even 
approximately  correct. 

t  Mr.  Charles  H.  Shinn  wrote,  in  1888,  a  brief  monograph  entitled 
"Cooperation  in  California,"  which  was  published,  among  other  studies  in 
cooperation,  by  the  Johns  Hopkins  University  Press.  My  good  friend  Mr. 
Shinn,  whose  information  is  very  wide  in  most  things,  was  apparently  so 
interested  in  the  literary  possibilities  of  some  picturesque  attempts  to  found 
cooperative  colonies  of  the  Brook  Farm  order,  that  he  entirely  overlooked  a 
substantial  cooperative  business  concern  that,  even  as  he  wrote,  was  selling 
nearly  a  million  dollars'  worth  of  fruit  each  year,  and  which  had  been  promi- 
nently discussed  in  the  press  since  1885. 


436  CALIFOENIA    FRUIT    SOCIETIES. 

co-operative  stores,  which  necessarily  grew  up  in  a  spirit  of 
altruism,  and  which  systematically  foster  the  altruistic  spirit 
from  the  instinct  of  self-preservation.  The  French  peasantry, 
tilling,  in  small  holdings,  a  soil  which  has  been  cropped  for  a 
thousand  years,  felt  their  greatest  need  to  be  economy  in  the 
purchase  of  fertilizers  and  tools,  and  the  result  was  the  agri- 
cultural syndicates  for  the  purchase  of  fertilizers  and  the 
purchase  and  rent  of  farm  machinery.  The  thrifty  people  of 
Denmark  felt  their  greatest  need  to  be  the  perfection  and 
economical  production  of  a  product  for  which  their  country 
was  best  fitted,  and  the  result  was  their  remarkable  success  in 
cooperative  dairying.  The  peasantry  of  Germany  were 
groaning  under  the  oppression  of  petty  but  conscienceless 
usurers,  and  the  result  was  Schutze,  and  RaifResen,  and  their 
people's  banks.  Until  lately,  the  rural  people  of  the  United 
States  have  not  been  enduring  particular  trouble  of  any  kind, 
and,  hence,  have  been  unable  to  cooperate — a  fact  which 
neither  Professor  Bemis,  nor  Professor  Ely,  nor  Professor 
Warner,  nor  any  other  of  the  learned  men  who  have  discussed 
early  failures  in  cooperation  in  America,  have  seemed  to  real- 
ize. At  last,  the  fruit-growers  of  California,  who  were  con- 
fronted with  a  great  fruit  product  for  which  they  owed  money, 
but  which  they  could  neither  eat  nor  sell,  found  it  necessary 
to  work  together  to  create  and  maintain  the  necessary  markets. 
The  pressure  has  made  them  cooperate. 

I  was  actively  connected  with  this  movement  for  about 
three  years  as  a  leader.  Since  that  time  I  have  been  one  of 
the  rank  and  file.  I  know  all  those  who  are  now  leaders  in 
the  movement  too  well  to  make  it  possible  to  give  the  indi- 
vidual mention,  which  always  adds  to  the  interest  of  a  narra- 
tive, for  I  have  learned  that  one's  recollection  is  seldom  to  be 
trusted  in  sucli  matters,  and  I  know  tliat  in  giving  credit  I 
should  make  errors,  which  would  be  excused  in  a  stranger,  but 
for  which  I  could  hardly  hoi)e  to  be  forgiven.  There  arc 
many  men  now  active  and  prominent  in  cooperative  work, 
but  of  those  who  were  so  in  the  early  days,  when  active  friends 
were  needed  more  than  now,  I  dare  mention  but  a  few.  In 
the  organization  of  the  California  Fruit  Union — the  earliest  of 


THETi:    PHARACTKi;    AND    Oli.IKC'T.  437 

the   large   societies— those   specially    active   were   Mr.    A.   T. 
Hatch,   Mr,  L.  W.  Buck,  Mr.  H.  P.  Livermore,   Mr.  W.  H. 
Aiken,  and  Mr.  H.  Weinstock.      These  earliest  pioneers  are 
specially  worthy  of  mention,  from  the  fact  that  they  were  the 
first  to  break  ground.      In  tlio   organization   of  the  Citrus 
Associations  of  the  southern  counties,  all  will  agree  that  Mr. 
T.  H.  B.  Chamblin,  of  Riverside,  was  the  principal  factor.     He 
never,  I  think,  served  as  a  working  officer  of  an   established 
society.     Mr.  A.  H.  Naftzger  has,  for  many  years,  been  presi- 
dent  of  these   Associated   Citrus   Exchanges,  and   can   show 
abundant  evidence  of  his  effectiveness  in  the  vigor  with  which 
he  is  denounced  by  outsiders.     In  the  dried-fruit  trade,  the 
pioneer  (successful)    organization   was  the   West   Side  Fruit 
Growers'  Union  in  Santa  Clara  County,  whose  first  president 
was  Colonel  Philo  Hersey,  of  Santa  Clara,  who  has  also  been 
president  of  the  Santa  Clara  County  Fruit  Exchange  from  its 
first  organization.    The  first  meeting  of  cooperators  which  I 
ever  attended,  and  which  was  a   very  large  one,  resulting  in 
the  organization  of  the  Santa  Clara  County  Fruit  Exchange, 
was  called  to  order  by  Mr.  F.  M.  Righter,  of  Campbell,  and 
the  principal  address  w^as  by  Colonel   Hersey,  then  president 
of  the  West  Side  Union,  which  had  been  in  existence  for  a 
year.     These  two  were  then  undoubtedly  the  principal  leaders 
in  cooperation  in  the  dried-fruit  trade.      The  organization  of 
that  industry  in  the  southern  counties  has  been  mainly  due  to 
Mr.  A.  R.  Sprague,  of  Los  Angeles.     In  the  raisin  industry,  in 
the  San  Joaquin  Valley,  cooperative  work  began  with  local 
packing  associations,  of  which  but  two  or  three  lasted  long. 
Attempts  w^ere  made  every  year  or  two  to   unite  the  entire 
raisin  industry  in  one  organization,  which,  however,  did  not 
succeed  until  1898.     I  spent  a  portion   of  one  winter  among 
them  in  aid  of  one  of  these  efforts,  and  some  of  the  men  then 
most  active  were  Professor  D.  T.  Fowler,  now  of  Berkeley,  Dr.  E. 
S.  Eshelman,  Alexander  Gordon,  and  John  S.  Dore,  of  Fresno, 
Mr.  F.  W.  Rowell,  of  Easton,  and  Mr.  B.  E.  Hutchinson,  of 
Fowler;   and   presumably  these  had   been   leaders   from   the 
beginning;  and  there  are,  doubtless,  others  equally  entitled  to 
mention.     In   the   final   crystallization   of  almost  the   entire 


438  CALIFORNIA    FRUIT    SOCIETIES. 

body  of  raisin-growers  into  what  is  practically  an  effective 
Trust,  Mr.  M.  Theodore  Kearney,  of  Fresno,  was  undoubt- 
edly the  leading  spirit,  heartil}^  seconded  by  most  of  the 
leading  men  of  Fresno.  Previous  to  1898,  Mr.  Kearney  had 
not,  so  far  as  I  know,  been  identified  with  any  cooperative 
movement.  Mr.  B.  F.  Walton,  of  Yuba  City,  and  Mr.  John 
Markley,  of  Geyserville,  are  entitled  to  mention  for  helpful 
effort  in  many  cooperative  enterprises.  Mr.  Markley  was  one 
of  the  first  directors  of  the  California  Fruit  Union.  Among 
those  who  were  most  prominently  connected  witli  the  organiza- 
tion of  the  wine-makers  were  Colonel  F.  Bendel,  Mr.  P.  C. 
Rossi,  Mr.  A.  Sparboro,  and  Mr.  W.  B.  Rankin.  This  personal 
mention  is  made,  partly  because  it  is  ])roper  that  those  who 
have  been  specially  active  should  receive  due  recognition, 
and  partl}^  to  give  to  any  one  who  may  be  interested  to 
look  further  into  the  history  of  these  organizations  the 
names  of  some  who,  if  still  living,  may  give  further  informa- 
tion. For  reasons  already  stated,  I  have  usually  omitted,  in 
the  narrative  which  follows,  to  make  personal  mention  of  any 
one. 

To  the  student  of  social  movements,  the  cooperative  efforts 
of  the  California  fruit-growers  are  of  interest  in  several 
respects.  While  the  numbers  involved  are  trifling  as  compared 
with  those  of  the  great  cooperative  societies  of  Europe,  there 
are  at  least  six  or  seven  thousand  scattered  over  an  area 
of  seventy-five  tliousand  or  eight}'  tliousand  square  miles. 
The  amount  of  business  transacted,  while  small  in  comparison 
with  that  of  the  European  societies,  is  respectable,  and  tlie  sale 
of  produce  to  the  amount  of  nearly  $5,000,000  in  contested 
markets  from  one  thousand  to  six  thousand  miles  away, 
represents  an  expenditure  of  cooperative  vigor  equal  to  that 
required  for  the  cooperative  purchase  of  commodities  of  many 
times  that  sum  in  a  thickly  settled  country  like  France. 
The  interdependence  of  classes,  and  the  frequent  necessity  of 
compromises  between  them,  is  shown  by  the  fact  that  the  raisin- 
growers  were  unable  to  effectively  combine  among  themselves 
for  the  control  of  their  product,  except  by  a  compromise  with 
an  adverse  interest — the  commercial  packers — by  which  tlie 


THEIR   CHARACTEK    AND    OIUEf'T.  439 

latter  were  permitted  to  have  a  share  in  tlie  business.  The 
progress  of  business  education  among  the  masses  is  shown  in 
,tlie  fact  that  this  phm,  in  1897,  proved  successful  with  the 
raisin-growers,  although  the  suspicion  and  jealousy  of  the 
people  broke  up  the  California  Fruit  Union,  conducted  on  that 
plan,  some  years  before. 

It  should  be  interesting  to  note,  in  comparison  with 
cooperative  effort  in  other  countries,  how  identical  motives 
Mud  arguments  may  be  employed  both  to  promote  societies 
organized  to  obtain  higher  prices  and  also  those  to  secure 
lower  prices.  The  California  societies  are  instances  in  which 
people  of  intelligence  and  sufficient  means,  although  usually 
greatly  indebted,  have  organized  with  no  great  display  of 
altruistic  spirit,  in  the  main  upon  commercial  lines,*  for  the 
promotion  of  commercial  ends.  Such  distress  as  existed  was 
the  result  of  indebtedness,  and  the  fear  of  future  want;  and  the 
early  appearance  of  cooperation  was  due  to  the  general  intel- 
ligence of  the  fruit-growers.  Even  among  this  class  the 
student  will  note  the  same  jealousy,  suspicion,  and.  disinclina- 
tion to  unite,  which  the  workers  in  more  altruistic  coopera- 
tion describe  as  existing  among  the  classes  whom  they  were 
striving  to  benefit,  and  which  I  found  precisely  the  same  in 
some  cases  of  strictly  capitalistic   cooperation   with  which  I 


*The  salaries  paid  indicate  this.  The  salary  of  the  president  of  the  Kaisin- 
growers'  Association  is  |500  a  month.  There  are  many  cooperative  officers 
who  are  paid  at  the  rate  of  from  $2,000  to  $3,600  per  aniinm.  The  usual 
salaries  paid  the  managers  of  local  oi-ganizations  is  from  f  1,800  per  year  down, 
depending  upon  the  amount  of  husiness  and  the  time  required  of  the  mana- 
ger. It  is  curious  to  contrast  these  salaries  with  the  .salary  of  $1,-500,  paid  to 
the  manager  of  the  Leeds  Cooperative  Society,  with  thirty-three  thousand 
members,  and  an  annual  business  of  $5,000,000 — the  largest  cooperative  salary 
paid  in  England — or,  still  more,  with  the  salary  of  $1,000  a  year,  paid  to  Mr. 
J.  W.  T.  Mitchell,  for  twenty-one  years,  and  until  his  death,  manager  of  the 
English  Cooperative  Wholesale  Society,  representing,  in  1897,  one  million 
fifty-three  thousand  five  hundred  sixty-four  members  of  affiliated  societies 
and  with  net  sales  of  $57,693,492.  Mr.  Mitchell  was  a  man  who  in 
competitive  business  could  have  commanded  a  salary  of  $25,000.  He  could, 
of  course,  have  had  a  larger  salary,  but,  being  an  unmarried  man,  would  not 
take  it,  and  his  estate,  when  he  died,  was  probably  under  $2,000.  American 
cooperation  has  developed  no  .such  men. 


440  CALIFORNIA    FRUIT    SOCIETIES. 

was  familiar  in  former  years,  I  do  not  wisii  Lo  imply  that 
altruism  has  been  absent  from  cooperation  in  California.  The 
efforts  for  organization  have  been  largely  altruistic,  but  the 
altruism  was  rather  that  of  the  public-spirited  citizen,  having 
in  mind  the  general  welfare  of  his' city  or  his  state,  than  of 
great  souls  stirred  to  their  depths  by  the  sight  of  actual  pov- 
erty. The  management  of  the  society  has  not  usually  been 
altruistic,  except  that  directors,  and  in  some  cases  presidents, 
have  served  without  pay.  Another  thing  which  has  devel- 
oped has  been  tlie  competition  of  cooperative  societies  in  the 
same  branch  of  the  industry.  The  California  Fruit  Exchange 
was  broken  up  by  the  refusal  of  the  older  dried-fruit  societies 
to  unite  with  tlie  newer  creations.  These  have  learned  a  les- 
son, and,  as  I  write,  are  trying  to  come  together.  The  Santa 
Clara  County  Fruit  Exchange  was  avowedly  organized  to  be 
the  head  and  selling  ngent  of  the  other  Santa  Clara  societies, 
but  when  it  was  organized,  not  one  would  come  in  for  some 
time;  the  pioneer  society  never  did  come  in,  and  none  remained 
permanently,  although  three  finally  united  with  the  Exchange 
in  maintaining  a  common  selling  agency.  The  Citrus  Ex- 
changes have  never  been  all  united  under  one  head. 

The  history  of  the  California  societies  shows  the  gradual 
development  among  the  people  of  the  conviction  that  the 
principle  of  cooperation  in  an  industry  for  marketing  pur- 
poses is  identical  with  that  of  the  cooperation  of  capitalists  in 
what  are  called  "Trusts,"  the  arguments  employed  in  their 
promotion,  and  the  obstacles  encountered,  being  precisely  the 
same.  The  California  Raisin  Association  is  the  first  society  of 
farmers  to  actually  realize  this  ideal  of  cooperative  marketing. 
Another  fact  disclosed  in  the  California  experience  is  the 
unwillingness  of  the  most  competent  to  unite  in  cooperative 
effort  Many  persons  of  large  means  are  engaged  in  fruit- 
growing in  California,  and,  with  a  few  notable  exce{)tions,  they 
have  been  the  meanest  men  we  have  found  to  deal  with.  They 
desired  cooperation  to  go  on,  fully  recognizing  its  benefits  to 
the  industry,  but  refused  in  any  way  to  be  compromised  by  it. 
They  kept  their  information  to  themselves,  but  undersold 
whenever   they   thought    best,  and   spoke   in   contemptuous 


THEIR    CHARACTER    AND    OBJECT.  441 

'terms  of  cooperative  ettbrt.  They  liavc  saiu,  with  mucli  truLli, 
that  there  was  no  dependence  to  be  placed  upon  the  small 
farmers,  who  would  sa}-  one  thing  and  do  another,  and  have 
left  the  work  of  organization  and  instruction  to  men  far  less 
interested  than  themselves,  but  possessed  of  more  public  spirit. 
Within  a  year  or  two  increasing  pressure,  involving  danger  to 
large  investments,  has  brought  this  class  of  men  largely  into 
the  cooperative  vineyard,  where  they  are  none  the  less  wel- 
come because  they  come  late.  They  bring  commercial  ability 
and  financial  strength,  and  will  get  their  penny  with  the  rest. 
California  is,  of  course,  not  the  only  country  where  coopera- 
tive marketing  has  been  attempted.  It  is  a  feature  of  some 
European  societies,  but  their  operations  in  this  direction,  wliile, 
probably,  in  the  aggregate,  exceeding  those  of  California,  have 
not  attracted  much  attention  from  writers  on  the  subject.  The 
grape-growers  of  New  York  and  Ohio  maintain  organizations, 
which  have  been  successful  in  some  years,  and  unsuccessful 
in  others.  The  fruit-growers  of  Georgia  and  Oregon  have 
made  similar  efforts,  and  one  society  was  organized  designed 
to  include  all  tlie  fruit-growing  interests  of  the  United  States, 
for  which  the  time  is  not  yet  ripe.  The  fruit-growers  of  Florida 
have  also  had,  and  perhaps  still  have,  a  marketing  society. 
I  have  not  the  data  to  give  the  facts  in  regard  to  any  of  these 
societies,  but  the  student  of  cooperation  may  know,  without 
special  inquiry,  that  the  experience  in  tliose  states,  and  in 
Europe,  is  substantially  the  same  as  tliat  of  California. 
Human  nature  and  the  law^s  of  trade  are  much  the  same 
everywhere. 


CHAPTER    11. 

CONDITIONS    LEADING    TO    THEIR    ORGANIZATION. 

THE  history  of  the  settlement  and  development  of  Cali- 
fornia is  a  marvel.  There  has  been  nothing  like  it  in 
the  world's  history.  The  circumstances  of  its  settlement 
led  to  its  colonization  by  a  people  of  wonderful  vitality;  the 
charm  of  its  climate,  the  fertility  of  its  soil,  the  character- 
istics of  its  topography,  its  flavor  of  old  buccaneering  legend, 
culminating  in  the  wonderful  romance  of  the  annexation  and 
gold-seeking  epoch,  combined  to  insure  it  such  an  amount  of 
gratuitous  and  enthusiastic  advertising  as  no  country  and  no 
community  ever  before  received.  The  romance  of  the  gold 
era  was  followed  by  the  romance  of  the  wheat  era,  with  its 
great  farms,  whose  furrows  were  miles  long,  in  following  which 
the  plowman  starting  in  the  morning  returned  to  his  starting- 
place  only  in  time  for  the  noon-day  meal,  and  whose  soil, 
fabled  to  be  of  inexhaustible  fertility,  yielded  stores  beyond 
measure  to  the  granaries  of  the  world;  this,  in  turn,  was 
followed  by  the  fruit  idyl,  far  more  attractive  than  the  wheat 
industry,  and,  for  a  time,  surrounding  California,  with  a  halo 
of  rural  blessedness  which  was  a  lure  to  the  world.  What- 
ever has  been  done  in  California  has  been  great  of  its  kind. 

The  hold  which  the  fruit  industries  of  California  gained 
upon  the  imagination  of  the  world  was  astonishing.  The 
frost-pinched  denizen  of  colder  climes  pictured  to  himself  the 
fortunate  orchardist  of  California  as  one  whose  happy  days 
were  passed  in  shady  nooks,  wherefrom  he  idly  watched  the 
gradual  ripening  of  golden  fruit  in  sun-kissed  orchards,  or 
recruited  waning  strength  in  gentle  exercise  among  the  laden 
boughs,  whose  luscious  burden  should  presently  supply  his 
every  want. 

That  was  the  picture.  As  a  matter  of  fact,  fruit-growing  in 
California  is  not  only  one  of  the  most  risky  of  industries,  but  is 

(  442  ) 


CONDITTOXS    LEADIXd    TO    ORGA  XIZATloX.  443 

necessarily  pursued  with  longer  continued,  more  unremitting, 
severer,  and  more  prosaic  labor  than  any  other  agricultural 
business  in  the  world.  There  is  no  more  romance  in  digging 
about  fruit  trees  than  there  is  in  digging  post  holes.  It  is  far 
harder  to  plow  an  orchard  than  a  grain  field,  for  the  trees  are 
in  the  way.  I  would  as  soon  saw  wood  as  to  stand  on  a  ladder 
all  day  long,  straining  every  nerve  to  reach  high  branches 
that  I  can't  reach,  in  pruning,  thinning,  or  picking.  I  know 
no  occupation  more  certain  to  produce  backache  than  the 
continuous  packing  of  fruit,  whether  sitting  or  standing  The 
sun-kissed  orchard  in  August  has  a  .usual  temperature  of 
one  hundred  forty  degrees  Fahrenheit,  which,  in  the  moist 
atmosi)here  of  the  east,  would  mean  death  to  most  of  us, 
and  which,  while  safe  enough  in  California,  is  about  as  desir- 
able a  place  for  a  white  man  to  stay  out  of  as  exists.  The 
waste  of  the  "luscious  golden  fruit"  which  accumulates  about 
a  packing-house,  is  about  as  nasty  a  mess  as  I  know  of  As 
for  leaving  the  work  for  others,  if  there  was  ever  a  business 
requiring  the  constant,  unremitting,  and  individual  attention 
of  its  owner,  who  must,  withal,  have  no  mean  account  of 
technical  skill,  it  is  the  fruit  business.  The  owner  de})ending 
on  his  orchard  for  an  income,  who  attempts  to  conduct  its 
operations  from  a  hammock  in  a  shady  nook,  may  contemplate 
with  certainty  an  early  visit  from  the  sheriff,  on  business  of 
the  most  pressing  nature.  It  is  only  the  keenest  of  men  who 
can  make  money  by  delivering  a  perishable  food  product  in  a 
market  twenty-five  hundred  miles  distant  by  land,  in  com- 
petition with  food  products  raised  on  equally  good  land,  held 
at  one-half  the  price  per  acre,  and  which  pays  not  more  than 
a  tenth  of  the  freight.  The  men  who  do  this  do  not  operate 
from  hammocks. 

This  contrast  of  the  actual  with  the  expected  conditions  of 
our  fruit  industry  is  necessary  to  an  understanding  of  the 
origin  and  growth  of  our  cooperative  societies.  A  certain 
.glamor  with  which  the  poetic  instinct  of  mankind  has  sur- 
rounded the  fruit  industry  rendered  a  large  element  of  society 
an  easy  prey  to  real-estate  interests  which  existed  in  California 
on   the  magnificent   scale  ueculiar   to  the  state,  and  which 


444  CALIFORNIA    FRUIT    SOCIETIES. 

exploited  the  fruit  business  during  some  years  with  a  wonder- 
ful ardor  and  success.  It  became  the  fashion  to  own  fruit 
farms,  and  no  family  belongings  were  complete  without  one. 
It  was  proven,  as  plainly  as  figures  could  prove  anything,  that 
the  ownership  of  a  small  fruit  farm  insured  competence  and 
comfort  after  four  years;  it  might  be  earlier,  but  that  was  not 
promised,  and  tliere  were  some  so  cautious  as  to  admit  that 
five  or  six  years  might  elapse  before  really  satisfactory  net 
incomes  would  be  assured;  but  that  was  the  limit,  and  during 
the  craze  it  was  firmly  believed  by  the  majority  of  Californians 
that  a  man  or  woman  with  no  knowledge  of  horticulture 
might  safely  purchase  land  at  from  $100  to  $300  per  acre,  on 
credit,  and,  by  paying  a  few  dollars  per  acre  for  a  few  years 
for  planting  and  cultivation,  secure  from  his  property  an 
income  which,  in  a  few  years,  would  pay  off  the  debt  and 
leave  him  comfortably  provided  for  life.  The  result,  of  course, 
was  a  rush  of  teachers,  clerks,  and  others  with  fixed  incomes, 
to  buy  fruit  farms  on  instalments.  Ordinarily  prudent  mer- 
chants invested  on  a  larger  scale;  there  was  a  great  influx 
from  the  east,  especially  into  southern  California,  whose 
orange  groves — really  very  profitable  for  some  years — were  a 
wonderful  attraction  to  visitors  from  colder  regions ;  large 
grain  farms  were  subdivided  into  fruit  plots,  until  in  some 
districts  one  could  ride  for  miles  amid  a  constant  succession  of 
orchards;  and  the  whole  state  was  alive  with  prosperity  and 
hope.  The  great  savings  banks  almost  alone  kept  their  heads, 
and  would  lend  no  money  on  orchard  property. 

It  may  be  useful  to  devote  a  paragraph  to  show  in  detail 
some  of  the  errors  in  the  calculations  of  inexperienced 
orchardists.  In  the  first  place,  the  cultivation  of  orchards  is 
expensive.  With  no  rain  during  the  summer,  the  moisture 
must  be  preserved  in  the  ground  by  constant  stirring.  The 
largest  orchardists,  employing  unmarried  help,  who  furnish 
their  own  blankets,  and  often  live  in  cabins  with  rude  bunks 
ranged  one  above  another,  like  bertlis  on  shipboard,  abun- 
dantly fed,  to  be  sure,  but  otherwise  costing  nothing  for  keep, 
and  employed  and  discharged  according  to  the  needs  of  the 
work,  were  able  to  reduce  costs  of  cultivation  to  a  compara- 


CONDITIONS  li;ading  to  organization.  445 

tively  small  figure;  but  to  the  small  farmer  with  ten  to  fifty 
acres  of  orchard  or  vineyard,  this  was  not  possible.  The  men 
with  whom  he  and  his  family  must  daily  associate  nmst  be 
decent  men,  and  to  keep  such  he  must  make  their  surround- 
ings decent.  Especially  the  non-resident  owner  must  have 
faithful  men  on  his  place,  and  house  them  comfortably.  Nor 
could  he  be  continually  discharging  them,  and  taking  on  new 
men.  The  succession  of  work  is  constant,  and  men  must  be 
there  to  do  it.  In  a  bearing  deciduous  orchard,  as  soon  as  the 
fruit  is  gathered,  the  pruning  begins.  In  pruning  full-grown 
trees  an  average  of  twenty  trees  per  day  is  a  day's  work,  or 
five  days  to  the  acre,  or  two  hundred  days  of  pruning  to  a 
forty-acre  orchard,  with  a  month  more  in  disposing  of  the 
brush.  The  pruning  over,  the  plowing  and  cultivation  begin, 
and  continue  every  day  until  fruit  pits  begin  to  harden. 
Then  follows  the  thinning,  often  requiring  three-fourths  of 
the  fruit  to  be  laboriously  picked  off  by  hand,  and  always 
lasting  until  the  earlier  varieties  begin  to  ripen.  In  the  mean- 
time there  has  been  winter  spraying  with  chemical  insecticides 
— a  tedious  and  expensive  process — and  summer  spraying  with 
other  preparations  for  other  classes  of  insects.  When  the 
harvest  begins,  more  help  must  be  employed.  The  eastern 
farmer  finds  it  hard  and  expensive  work  to  gather  a  burden  of 
two  to  five  tons  per  acre  of  hay  or  grain,  which  he  cuts  and 
handles  by  machinery;  he  would  be  appalled  at  the  prospect 
of  gathering  a  product  of  ten  to  fifteen  tons,  in  pieces  of  a  few 
ounces,  each  carefully  picked  by  hand,*  from  the  tops  of  trees, 
and  always  handled  several  times  over.  The  harvest  over 
the  pruning  begins  again,  and  so  on  forever.  The  conflict 
with  insects  and  parasites  is  unceasing.  If  undisturbed,  they 
destroy  the  orchards,  and  there  is  a  constant  expense  on  their 
account.  The  loss  of  trees  is  very  large;  bad  planting  or  poor 
cultivation  impairs  the  vitality  of  many  trees,  and  leaves 
them  ready  to  succumb  to  the  first  injury,  usually  not  actualh- 
dying,  which  would  be  desirable,  but  leading  an  unprofitable 
and   expensive  existence  for  years ;   sunburn    destroys    thou- 


*  Except  prunes,  which  are  shaken  from  the  tree  and  picked 


446  CALIFORNIA    FRUIT    SOCIETIES. 

sands;  root-knot,  thousands  more;  standing  water  in  a  wet 
winter  is  very  destructive;  and  thousands  of  full-grown  trees 
die  annually,  often  fully  laden  with  fruit,  and  for  no  cause 
whatever  that  can  be  discovered.  A  great  loss  also  arises  from 
the  digging  up  or  regrafting  trees  which  have,  after  years  of 
cultivation,  been  found  unprofitable;  it  is  not  every  tree  that 
will  be  profitable  in  every  place,  and  the  infinite  variety  of 
soil  and  exposure,  which  is  one  of  the  attractions  of  California, 
vastly  multiplies  the  chances  of  error  in  planting  ;  nor  do  all 
varieties  which  thrive  and  bear  well  prove  profitable;  nor  are 
varieties  which  yield  profit  in  one  locality  sure  to  be  desirable 
in  other  places  where  they  ripen  earlier  or  later;  and  it  often 
happens  that  varieties  for  which  there  is  a  limited  sale  at  fair 
prices,  become  utterly  profitless  when  production  is  increased  ; 
and  of  the  varieties  which  have  to  be  sold  fresh,  there  is  not 
only  the  risk  of  crop  failure  which  attaches  to  all  plantings, 
but  some  years  and  from  some  localities  they  are  found  to 
"  carry"  well,  and  arrive  in  good  condition  after  long  journeys, 
and  sometimes  they  do  not.  In  fact,  there  is  no  end  to  the 
variety  of  risks  which  assail  the  business  from  all  sides,  and 
the  replanting  and  regrafting  of  orchards  is  constantly  in 
progress,  so  that  to  this  time  I  believe  that  fifteen  years  would 
be  an  extreme  limit  to  assign  as  the  life  of  a  tree  in  California. 
Of  course  a  great  part  of  this  tree  loss  is  preventable;  and  the 
most  competent  and  experienced  have  never  suffered  as 
severely  as  I  have  indicated,  and  perhaps  no  single  orchardist 
has  endured  all  the  misfortunes  which  I  have  mentioned ;  but 
I  am  considering  average  conditions,  and  a  certain  amount  of 
-risk  is  inevitable.  So  that,  even  allowing  for  tlie  better  results 
which  experience  has  brought,  I  can  not  put  the  expected 
average  life  of  a  fruit  tree  in  California  as  above  twenty  years, 
or  the  average  number  of  crops  to  be  expected  as  over  fifteen. 
There  is  also  to  be  considered  the  inevitable  deterioration  of 
the  soil,  by  reason  of  which,  except  in  so  far  as  it  is  combated 
by  expensive  fertilizers,  the  quantity  and  quality  of  the  fruit 
crops  will  diminish  as  certainly  as  the  quantity  and  quality  of 
the  wheat  crop  has  diminished.  Finally,  it  inevitably  hap- 
pened that,under  theunreasonablestimulus  applied,  the  produc- 


CONDITIONS    LEADlNd    TO    OK(iA  XIZATION.  117 

tion  of  all  kinds  of  fruit  and  fruit  products  increased  far  beyond 
any  existing  demand,  and  far  beyond  any  possible  sales  except 
as  new  markets  were  created.     The  raisin  industry,  which,  in 
spite  of  warnings  from  official  sources,  was  exploited  long  after 
all  possible  remunerative  demand  had  been  provided  for,  was 
the  first  to  suffer,  as  vines  came  more  quickly  into  bearing 
than  trees;  next,  eastern  shipments  of  deciduous  fruits  became- 
unprofitable;  then  followed  the  orange  industry;  and,  finally, 
the  profits  on  prunes  and  other  dried  fruits  began  to  disappear. 
A  community  of  fruit-growers  beginning  with   anticipa- 
tions based  on  conceptions  more  or  less  founded  upon  such 
views  of  the  industry  as  have  been  described,  and  ending  under 
such  conditions  as  have  been  set  forth  in  the  last  three  para- 
graphs, was  ripe  for  cooperation.      To  add  to  their  troubles 
they  found  that,  while  in  time  they  gradually  learned  the  art 
of  producing  good  fruit,  the  problem  of  marketing,  which  was 
still  before  them,  was  perhaps  even  more  difficult.      Their 
orchards  were  twenty-five  hundred  miles  from  the  center  of 
their  most  important  consuming  district;  the  nature  of  their 
product  did  not  permit,  to  any  great  extent,  the  use  of  sea 
carriage,  under  existing  conditions,  and  the  major  portion  was 
subjected  to  a  land  haul  exceeding  two  thousand  miles,  and 
extending  to  three  thousand  miles,  where,  at  the  Atlantic  sea- 
board, it  competed  with  fruit  and  fruit  products  produced  in 
close  proximity  to  those  markets,  or  imported  at  one-fifth  the 
freight  charge,  from  foreign  lands,  where  it  was  produced  at 
one-half  the  cost  of  the  California  product.     The  Californian 
orchardist  or  vineyardist,  with  no  traditions  or  general  informa- 
tion  in  regard   to   his  industry,  had    no   knowledge  of  the 
capacity  of  his  market,  or  the  extent  and  character  of  his  com- 
petition.    At  the  beginning  he  made  money,  and  continued  to 
do  so  as  long  as  there  was  a  market  on  the  Pacific  slope,  and 
west  of  the  Missouri,  for  all  his  product;  as  the  pressure  on 
the  local  market  reduced  prices,  the  sales,  with  characteristic 
Californian   energy,  were  pushed  farther  and  farther  afield. 
The  first  attack  on  the  eastern  market  with  deciduous  fruits 
was  with  fresh  fruit  shipped  by  passenger  trains  in  an  ordinary 
freight  car,  at  a  cost  of  $1,400  for  ten  tons,  or  seven  cents  a 


448  CALIFORNIA    FRUIT    SOCIETIP:S. 

pound.  Of  course  at  such  cost  it  was  only  taken,  first,  as  a 
curiosity,  and  later  as  a  luxury,  by  the  few  who  could  afford 
it.  In  1894  this  trade  had  increased  to  over  seven  thousand 
car-loads,  at  a  freight  rate  of  one  and  one-fourth  cents  a 
pound;  the  citrus  shipments  from  southern  California,  with 
like  beginnings,  increased  to  over  14,000  car-loads  in  1897-98. 
The  rainless  summers  and  autumns  of  California  permit  all 
classes  of  fruit — except  on  the  seacoast— to  be  dried  in  the 
sun,  at  a  minimum  of  expense,  and  with  excellent  results. 
Many  varieties  flourish  there  which  will  not  thrive  in  other 
parts  of  the  country,  or  which  have  not  been  elsewhere  intro- 
duced; and  the  excellent^  quality  of  the  fruit  insured,  under 
the  exceptional  climatic  conditions,  a  product  which  had  no 
equal  of  its  kind  in  the  market.  Most  parts  of  the  state  were 
found  excellently  adapted  to  prunes,  and  while  at  first  they 
were  not  looked  upon  favorably,  they  soon  found  general 
acceptance  with  a  ready  sale,  and  a  market  at  eight  to  ten 
cents  a  pound  seemed  assured  for  all  that  were  produced. 
This  price,  with  the  yield  obtained  on  the  best  land,  involved 
enormous  profits,but  under  the  increasing  production, it  rapidly 
run  down  to  four  or  five  cents,  which,  with  some  orchards, 
was  then  thought  to  involve  a  loss;  and  it  has  since  declined 
to  three  to  three  and  one-half  cents.  The  total  annual  con- 
sumption of  the  country,  up  to  1888,  had  never  exceeded 
ninety  million  pounds,  nearly  all  imported,  while  in  1894 
there  were  trees  planted  in  California  alone  sufficient,  theo- 
retically, to  produce,  when  in  full  bearing,  two  hundred  mil- 
lion pounds  in  a  good  year,  which  must  be  sold  against  foreign 
prunes,  upon  which  the  combined  freight  and  duty  but  little 
exceeded  the  freight  east  on  the  California  product.  The 
raisin  industry  was  subjected,  for  a  long  time,  to  even  worse 
conditions,  the  Zante  currants,  which  specially  compete  with 
the  poorer  class  of  raisins,  being  admitted  duty  free.  The 
world-wide  advertisement  of  the  enormously  exaggerated 
profits  of  the  fruit  industry  of  California,  which  was  pro- 
moted by  the  land  and  transportation  interests  of  the  state, 
and  fostered  by  the  bragging  spirit  which  the  very  air  of 
California  induces  in  all  her  people,  sot  all  the  world  at  work  at 


CONDITIONS    LEADING    TO    ORGANIZATION.  449 

the  same  industry,  and  gradually  it  became  evident  that  great 
districts  which  we  had  regarded  as  our  permanent  customers 
would  soon  be  in  the  market  as  competitors,  and  it  was  seen 
that  the  problem  of  production,  with  which  we  had  been 
occupied,  was  as  notliing  as  compared  with  the  problem  of 
marketing  the  vast  output  at  prices,  not  which  would  pay 
interest  on  land  at  the  high  rates  which  had  been  paid  for  it, 
for  that  was  obviously  impossible,  but  which  would  at  least 
pay  the  expenses,  and  interest  on  soinetliing.  Througliout 
the  world  the  increase  of  fruit  products  had  been  so  vast  and 
so  rapid  that  tlie  problem  of  their  sale  involved  the  problem  of 
displacing  some  other  food  product  to  a  corresponding  extent, 
and  that  interest  would  fight. 

At  the  beginning  the  process  of  marketing  w-as  simple. 
A  trade  grew  up  witli  the  business,  which  bought  and  paid  for 
the  product,  delivered  at  the  nearest  shipping-point,  and  that 
was  the  end  of  the  matter  to  the  grower,  and  it  was  satisfac- 
tory. In  the  wine  business  it  is  the  only  way  possible  for 
most  growers,  as  the  necessary  cooperage  and  suitable  storage 
required  capital  not  available  to  the  small  vineyardist.  In 
the  raisin  business,  also,  it  is  not  usually  possible  for  small 
growers  to  pack  their  product  to  the  best  advantage.  The 
orange-grower  sold  his  fruit  on  the  tree.  When  the  fresh 
deciduous  fruit  production  outgrew  the  capacity  of  the  local 
market,  a  few  of  the  largest  growers  assailed  the  task  of 
opening  the  eastern  markets;  and,  having  demonstrated  the 
possibility,  there  were  buyers  even  for  so  perishable  product 
as  that. 

But  as  the  product  increased  there  was  a  downward  tend- 
ency in  prices.  The  eastern  trade  w^as  perfectly  informed  of 
the  enormous  annual  increase  to  be  expected,  and  more  and 
more  each  year  inclined  to  wait  the  inevitable  effect  before 
purchasing.  The  very  high  prices  paid  in  some  years  to 
growers  proved  disastrous  to  many  local  buyers  who  paid 
them,  and  who  found  that  there  was  a  limit  quite  easy  to 
reach,  above  which  even  the  products  of  golden  California 
would  not  sell.  Year  by  year  there  was  less  disposition,  on 
the  part  of  local  buyers,  to  purchase,  but  instead  they  offered 
29 


450  CALIFOKNIA    FRUIT    SOCIETIES. 

to  take  the  products,  make  reasonable  advances,  and  market 
them  on  commission,  and  the  grower,  unable  to  sell  for  cash 
at  any  such  rates  as  he  had  been  accustomed  to  receive,  was 
compelled  to  accept;  this  action  on  the  part  of  the  local  trade 
immediately  brought  into  the  field,  especially  in  the  dried- 
fruit  branch  of  the  trade,  an  army  of  men  representing  eastern 
commission  houses,  who  represented  to  the  grower  the  superior 
advantages  of  a  commission  house  located  in  the  center  of 
consumption,  and  soon  great  quantities  of  fruit  began  to  be 
shipped  by  growers  for  sale  by  persons  situated  thousands  of 
miles  distant  from  the  owners,  and  of  whom  the  growers  had 
only  such  knowledge  as  was  afforded  b}^  the  business  card  left 
by  the  bright  solicitor  who  obtained  the  consignment.  Such 
a  condition  of  affi\irs  of  course  opened  the  door  wide  to  all 
sorts  of  fraudulent  practices,  and  as  the  opportunity  to  commit 
frauds  attracts  those  disposed  to  such  practices,  the  commis- 
sion business  became  infested  with  a  great  number  of  utterly 
unscrupulous  persons,  whose  dealings  brought  discredit  upon 
the  whole  business,  and  drew  down  upon  all  who  were  engaged 
in  it  the  indiscriminate  wrath  of  the  producers.  Having  no 
means  of  distinguishing  the  honest  from  the  dishonest,  they 
condemned  them  all  alike.  This  was  the  more  natural  since 
annually  the  increasing  pressure  to  sell  wrought  constantly 
increasing  tendency  to  lower  prices,  so  tiiat  even  the  most 
reliable  commission  houses  were  unable  to  make  returns 
approaching  the  expectations,  and,  in  fact,  the  necessities,  of 
the  consignors ;  this  again  was  aggravated  from  the  fact  that 
only  the  very  largest  marketing  centers  were  generally  recog- 
nized among  the  growers,  and  these  were  the  dumping-ground 
for  everybody's  product;  and  merchants  there,  with  little  need 
to  inj^est  capital  of  their  own,  were  enabled  to  supply  their 
wants  from  week  to  week,  as  one  after  another  of  the  growers, 
or  of  those  who  had  advanced  money  on  the  product,  directed 
the  goods  to  be  sold  for  whatever  they  would  bring,  and  with 
the  purchases  at  such  sales  were  able  to  successfully  compete 
in  the  smaller  interior  wholesale  markets  with  products 
remaining  in  growers'  hands,  or  in  the  hands  of  such  local 
buyers  as  still  remained  in  the  business.     During  all  this  time 


CUNDITKINS    LEADTXCf    To    <  )i;(  i  A  N  IZATK  »X.  451 

there  was  a  gradually  accumulating  series  of  disappointments 
to  those  who  liad  so  lately,  and  with  such  high  hopes,  em- 
barked in  what  they  expected  to  find  a  doliglitful  and  exceed- 
ingly profitable  occupation.  First  it  was  discovered  that  the 
annual  dividends  would  be  less  than  antici])ated;  then  tluit 
for  a  time  they  would  be  very  small  indeed;  then  that  they 
must  employ  cheaper  help  and  less  of  it;  then  that  they  must 
find  the  interest  on  the  mortgage  from  some  source  other  than 
the  orchard;  finally,  that  the  orchard  never  would  pay  the 
interest  on  the  mortgage,  and  that  no  sale  of  the  property 
could  be  made  except  at  an  enormous  sacrifice. 

While  the  orchardist  and  the  vineyardist  were  discovering 
these  things,  the  merchant  was  learning  that  expenditures 
were  being  curtailed,  and  accounts  no  longer  paid  at  maturity; 
and  bankers  and  capitalists  were  ascertaining  that  the  invest- 
ments in  orchards  and  vineyards  in  the  state  had  reached 
such  a  figure  that  the  serious  loss  which  was  threatened  upon 
them  was  certain  to  disturb  all  values.  It  was  seen  that,  while 
the  industry  in  the  end  would  right  itself  through  the  merci- 
less process  of  the  survival  of  tlie  fittest,  the  operation  would 
involve  widespread  distress  and  failure,  not  only  among  those 
actually  engaged  in  the  industry,  but  upon  all  the  business 
interests  of  the  state,  which  were  inextricably  involved  with 
and  dependent  upon  the  paying  and  purchasing  power  of  tlie 
orchardists  and  vineyardists.  Under  these  circumstances, 
and  since  it  was  evident  that,  with  continued  competition 
under  the  ordinary  laws  of  trade,  serious  disaster  affecting  all 
interests  in  the  state  was  imminent,  the  fruit  industry  of 
California  was  ripe  for  cooperative  effort. 


CHATTER.    III. 

THE    CALIFORNIA    FRUIT    UNION. 

THE  first  branch  of  the  fruit  business  to  suffer  from  bad 
methods  in  marketing  was  the  eastern  trade  in  fresh 
deciduous  fruits.  This  was  because  the  limit  of  pos- 
sible customers — that  is,  those  who  could  pay  over  eight  cents 
a  pound  for  table  fruits — was  the  easiest  to  reach,  and  also  on 
account  of  the  great  risk  of  loss  involved  in  shipping  delicate 
fruits  so  long  a  distance.  It  is  essential  to  this  trade  that  the 
collection  of  even  car-loads  be  assured  at  the  various  shipping 
stations  each  day,  as  the  fruit  can  not,  without  loss,  be  detained 
for  car-loads  to  accumulate.  At  the  beginning  of  the  season 
very  few,  even  of  the  largest  growers,  are  able  to  fill  a  car  on 
any  one  day,  and  the  great  majority  of  growers  are  never  able 
to  do  so.  The  large  shippers,  who  were  the  pioneers  in  this 
trade,  naturally  united  for  this  purpose  as  they  had  occasion, 
and  as  the  local  buyers  grew  less  disposed  to  risk  their  money, 
local  organizations  of  small  growers  were  gradually  formed 
for  this  purpose.  There  was,  however,  no  further  concert  in 
shipping,  and  it  frequently  occurred  that  an  eastern  market 
which  could  very  well  take  care  of  one  car-load  once  or  twice 
a  week  would  receive  several  car-loads  from  different  shippers, 
with  the  necessary  result  of  serious  loss  to  all,  while  other 
markets  that  would  gladly  have  taken  part  of  the  surplus 
were  left  bare.  The  plan  was,  therefore,  conceived  of  uniting 
all  the  growers  of  the  state  in  one  organization,  which  should 
receive  all  fresh  fruit  offered  for  the  eastern  trade,  distribute 
the  shipments  according  to  the  ascertained  capacity  of  the 
several  markets,  arrange  for  its  sale  through  commission 
houses  of  recognized  standing,  and  under  heavy  bonds  to  the 
association,  and  collect  and  distribute  the  proceeds,  charging 
therefore  the  actual  cost  of  the  service,  and  no  more. 

For  the  preparation  of  this  plan  several  large  conventions 

(452) 


THE    CALIFORNIA    rKUIT    UNION.  453 

were  held,  which  were  fully  reported  by  the  press;  many  of 
the  large  growers  freely  gave  their  time  and  expenses  in 
visiting  various  parts  of  the  state.  The  project  was  received 
with  enthusiasm  and  unanimity,  and  apparently  every  grower 
in  the  state  was  likely  to  join  in  a  movement  so  obviously  to 
their  advantage.  The  California  Fruit  Union  was,  therefore, 
incorporated  in  November,  1885,  with  an  autliorized  capital 
stock  of  1250,000,*  and  the  basis  of  stock  subscription  was 
made  at  $1.00  per  acre  of  orchard,  an  amount  which  it  was 
estimated  would  yield  an  ample  capital  for  tlie  purpose,  after 
paying  all  the  expenses  of  organization.  A  certain  fixed 
commission  was  charged  for  marketing  the  fruit,  out  of  which 
all  expenses,  including  six  per  cent  dividend  on  the  capital 
stock,  were  to  be  paid,  and  the  balance,  if  any,  paid  over  to 
the  growers  according  to  the  amount  shipped  by  each. 

But  it  was  soon  found  that  action  did  not  necessarily 
follow  talk;  all  were  anxious  to  see  the  union  established, 
but  few  were  willing  to  risk  the  dollar  per  acre.  The  great 
majority  of  the  growers  remained  idly  at  home  waiting  for 
some  one  no  more  interested  than  they  to  come  and  talk  to 
them,  when  they  might  decide  to  join  the  movement,  or  quite 
as  likely  want  time  to  think  it  over.  No  one  was  willing  that 
the  plan  should  be  given  up,  but  nearly  all  were  determined 
that  some  one  else  should  bear  the  burden.  At  no  time  did  the 
paid-up  capital  stock  exceed  $15,000,  representing  about  one- 
tenth  of  the  acreage  more  or  less  interested  in  the  deciduous 
fresh-fruit  trade.  All  this  was  consumed  in  expenses  of 
organization — ^that  is,  in  printing,  postage  and  the  traveling 
expenses  of  those  seeking  to  induce  their  fellow-growers  to 
unite  with  them. 

The  organization,  however,  was  effected  before  the  results 
were  apparent,  the  directors  being  mostly  large  growers,  well 
informed   as   to  the   methods   of  conducting   the   fresh-fruit 


*The  committee  recommended  that  the  capital  stock  should  be  $100,000, 
but  the  convention  would  not  listen  to  such  a  thing.  A  quarter  of  a  million 
it  must  be,  at  the  very  least,  which  was  very  comical  in  view  of  the  actual 
subscriptions  finally  made. 


454  CALIFORNIA    FRUIT    SOCIETIES. 

trade.  Organized  as  it  was,  however,  it  must  do  business  to 
live,  as  certain  expenses  were  necessary  in  order  to  do  any- 
thing; and  as  there  was  little  or  no  capital  stock  with  which 
to  meet  any. deficit,  the  failure  to  earn  commissions  meant 
bankruptcy.  Before  incurring  these  ex})enses  some  actual 
assurance  of  business  seemed  necessary,  and  while  the  large 
shippers  who  were  most  active  in  the  movement  could  supply 
a  great  deal,  they  could  not  guarantee  sufficient  to  insure 
success;  and  they  could  not  be  assured  from  other  sources, 
because  the  majority  of  the  growers  were  determined  that 
others  than  themselves  should  take  all  the  risk,  while  they 
would  continue  to  make  use  of  the  old  shipping  firms  which 
they  unanimously  said  they  wished  to  get  rid  of,  until  it 
should  be  demonstrated  by  others  that  a  growers'  shipping 
organization  should  succeed.  The  forwarding  houses,  who  of 
course  did  not  wish  to  lose  their  business,  made  no  open 
opposition  to  the  movement,  but  quietly,  as  occasion  offered, 
encouraged  distrust  and  suspicion  either  of  the  leaders  of  the 
movement  or  of  the  particular  plans  proposed. 

But  the  leaders  were  determined  men,  and  when  they 
realized  that  the  mass  of  the  growers  could  not  be  depended 
on  to  sustain  them  in  anything,  in  the  end  they  did  the  onl}'^ 
thing  possible  by  practically  compromising  with  the  then 
principal  forwarding  house,  making  it  tlie  principal  eastern 
agent  of  the  Fruit  Union,  on  condition  of  its  refraining  from 
direct  seeking  for  business  from  growers,  at  least  in  the  dis- 
tricts where  the  union  was  strong.  This  placed  the  union  in 
a  condition  to  do  business  safely,  and  it  at  once  became  the 
principal  agency  for  the  eastern  deciduous  fresh-fruit  shipping 
business,  a  position  which  it  retained  while  it  continued  in 
business,  its  sales  exceeding,  for  some  years,  an  average  of  a 
million  of  dollars,*  all  conducted  without  the  loss  of  a  cent. 
Its  weak  point  was  that  its  agency  was  far  stronger  than  itself, 
having  abundant  capital,  and  the  control  of  the  most  important 
eastern  outlets  for  distribution,  and  also  of  the  special  refrig- 


*  Its  gross  sales  in  1886  were  $345,416.98;    in  1887,  |€75,8«4.44;  in  1888, 
$773,117.42;  a  year  or  two  later,   $1,501,023.56. 


THE    CALIFORNIA    FRUIT    UNION.  455 

erating  cars,  which  were  in  due  time  brought  into  use.  In 
1894,  after  a  prosperous  year's  business  in  1893,  the  union 
went  out  of  business. 

The  causes  of  this  failure  in  cooperative  effort  were  due, 
first,  to  dissensions  among  some  of  the  large  shippers,  who 
were  the  original  leaders,  involving  a  lack  of  unity  in  pusliing 
the  proselyting  work,  at  a  time  when  the  influences,  if  heartily 
united,  were  strong  enough  to  unite  every  grower,  and  make 
it  impossible  for  competing  agencies  to  establish  themselves. 
Second,  the  senseless  folly  of  the  majority  of  the  growers,  who 
were  ready  to  suspect  the  motives,  and  criticize  the  acts  of 
those  charged  with  the  duty  of  directing  the  affairs  of  the 
union.  As  the  business  increased,  new  shipping-houses  nat- 
urally made  efforts  to  get  in,  with  no  care  whatever  for  the 
interests  of  the  growers,  which  imperatively  demanded,  in 
this  branch  of  industry,  one  directing  head  eoutroUing  the 
entire  volume  of  the  business.  Tliese  new  firms  found  that 
their  readiest  means  of  obtaining  a  foothold  was  to  instil  into 
the  minds  of  growers  a  suspicion  of  their  own  agents;  the 
notion  was  spread  widely  that  the  eastern  agents  controlled 
the  business,  and  that,  as  a  matter  of  fact,  it  was  not  their 
own  agency  which  the  growers  were  supporting,  but  a  private 
forwarding-house,  and  they  were  so  utterly  silly  that,  with 
that  notion  once  in  their  heads,  their  strong  impulse  was  to  at 
once  rush  into  the  arms  of  some  opposition  concern.  As  a 
matter  of  fact,  it  is  unlikely  that  the  forwarding-house  ever 
troubled  itself  in  the  least  about  the  control  of  the  union.  It 
had  no  motive  to  do  so.  The  union  collected  the  fruit  for 
shipment,  and  the  eastern  agents  received  and  sold  most  of  it. 
The  more  the  union  could  collect,  tlie  more  the  agents  would 
have  to  sell;  and  the  more  prosperous  the  union,  the  more 
profit  there  was  for  the  agents;  and  it  made  no  difference  to 
the  grower  whether  the  forwarding-house  controlled  it  or  not ; 
the  important  thing  was  to  concentrate  the  fresh  shipping 
fruit  under  one  management;  and  it  made  no  difference  to 
the  growers  what  that  management  was,  so  that  it  was  compe- 
tent; and  in  this  case  incompetence  was  never  charged.  In 
fact,  it  was  very  competent     The  main  thing  with  the  growers 


456  CALIFOKNIA    FRUIT    SOCIETIES. 

seemed  to  be  a  determination  that  no  one  who  served  them 
sliould  make  money,  especially  when  they  themselves  were 
not  prosperous;  and  in  their  blind  resentment  against  those 
who  served  them  well  and  did  make  money,  they  turned 
against  their  own  business,  and  gave  their  shipments  to  out- 
side parties,  in  nearly  all  cases  paying  more  money  for  no 
better  service,  and  to  no  better  men,  and  with  no  better  results 
to  themselves,  in  fact,  with  not  nearly  so  good  results,  for  in 
the  general  scramble  for  business  many  irresponsible  concerns 
got  in,  and  many  losses  occurred  through  the  spoiling  of  fruit 
intrusted  to  those  who  had  no  facilities  for  promptly  moving 
and  selling  it,  and  from  the  failure  in  business  of  others.  As 
a  matter  of  fact,  it  was  impossible  for  any  but  the  growers 
themselves  to  control  the  Fruit  Union,  if  they  would  only 
take  the  trouble  to  attend  the  annual  meetings  and  vote  for 
directors  of  their  choice,  or  place  their  proxies  with  those  who 
would  do  so;  but  they  did  neither;  the  annual  meetings  often 
had  to  do  business  without  a  quorum,  or  to  go  without  doing 
business  at  all.  The  owners  of  the  business  would  not  see  it 
done  to  their  satisfaction,  or  refrain  from  finding  fault  with 
the  way  it  was  done. 

Another  source  of  difficulty  to  the  union  was  the  gradu- 
ally-increasing embarrassment  of  many  growers  who  had 
engaged  in  the  business  with  high  anticipations  but  without 
adequate  capital,  and  who,  after  a  time,  began  to  require  large 
cash  advances  to  cultivate  and  harvest  their  crops.  These 
advances  could  be  obtained  from  the  forwarding  firms,  upon 
contracts  to  ship  their  fruit,  and  usually  from  no  other  source, 
as  a  growing  fruit  crop  is  worthless  for  security  except  to 
persons  in  a  situation  to  market  the  product.  Some  of  the 
directors  of  the  union  came  to  be  chosen  from  among  large 
shippers  who  bought  fruit.  These,  of  course,  were  really  inter- 
ested to  have  no  outlet  except  through  themselves,  in  their 
own  vicinity,  but  they  never  hindered  their  neighbors  from 
organizing,  and  often  encouraged  them  to  do  so;  and  as  none 
gave  so  much  business  to  the  union  as  they,  or  were  so  com- 
petent and  interested  to  manage  it  well,  they  were  proper 
persons  for  directors;  and  yet  their  neighbors,  while  complain- 


THE    CALIFORNIA    FRUIT    UNION'.  457 

ing  that  they  had  no  local  organization  for  loading  cars,  and 
perhaps  blaming  the  directors  for  it,  would  almost  never 
themselves  get  together  for  that  purpose,  or  take  any  step 
wluitever  to  do  so.  In  short,  the  growers  made  it  evident  that 
they  could  be  depended  upon  for  nothing  except  to  find  fault 
with  their  own  agents,  and  yet  make  no  effort  to  change  them. 
In  the  end  the  directors  got  tired,  and  the  forwarding-houses, 
by  aid  of  the  growers,  having  so  multi[)lied  that  the  union 
was  but  one  agency  among  many,  and  no  hope  remaining  of 
accomplishing  the  original  intent  of  the  union,  the  directors 
grew  weary  of  managing  a  business  for  which  they  were  not 
paid,  which  yielded  them  no  profit,  but  only  abuse,  and 
decided  to  stop. 


CHAPTER    IV. 

THE    CALIFORNIA    RAISIN   ASSOCIATION. 

IN  order  to  understand  fully  the  methods  of  organization 
pursued  in  the  raisin  districts,  some  explanation  of  the 
methods  of  raisin-making  is  essential.  The  grapes,  when 
ripe,  are  cut  and  placed  by  the  vines  on  light,  shallow  trays 
some  thirty  or  tlnrty-six  inches  square;  after  remaining  for 
some  days,  they  are  turned  by  covering  the  grapes  with  an 
empty  tray,  and  reversing  the  two,  leaving  the  grapes  on  the 
new  tray,  with  what  was  before  the  lower  side  now  exposed  to 
the  sun;  when  sufficiently  dried,  the  trays  are  stacked  either 
in  the  fields  or  under  sheds;  the  grapes— now  become  raisins- 
are  then  sorted,  bunch  by  bunch,  and  placed  in  boxes  about  four 
feet  square  and  a  foot  deep,  holding  about  one  hundred  pounds; 
the  very  largest  bunches,  suitable  for  table  use,  and  later  to 
become  the  raisins  known  to  commerce  as  "layers,"  are  placed 
by  themselves,  and  those  with  smaller  or  uneven  berries  or 
partly-filled  bunches  are  placed  in  other  boxes.  The  profit  of 
the  vineyard  depends  largely  on  the  proportion  of  "layers"  it 
will  produce,  and  this  again  depends  on  the  quality  of  the 
soil,  and  the  care  in  cultivation.  The  raisins  so  packed  in 
these  large  boxes  are  more  or  less  uneven  in  dryness,  but 
in  due  time  will  equalize  themselves,  and  all  become  moist 
and  pliable;  and  on  this  account  the  boxes  are  called  "sweat- 
boxes." 

Up  to  this  point  raisin-making  is  pure  horticulture,  requir- 
ing no  special  or  expensive  facilities.  Beyond  tliis,  however, 
the  small  grower  can  not  usually  go  without  expenditure  for 
appliances.  Tiie  layers,  before  packing,  have  to  be  steamed 
to  make  them  pliable,  while  the  inferior  bunches,  which  are  to 
make  "  loose  goods,"  must  be  stemmed  by  machinery.  At  this 
point,  therefore,  there  is  a  natural  division  in  the  business 
In  the  beginnings  of  the  raisin  industry  in  California,  or  at 

(458) 


CALIFORNIA    RAISIN    ASSOCIATION.  459 

least  when  the  pioneers  had  estabhshed  the  value  of  the  prod- 
uct, a  class  of  packers  grew  up  wlio  purchased  and  paid  for 
the  raisins  "in  the  sweat-box,"  delivered  at  their  packing- 
houses, thereafter  tbemselves  taking  all  the  risk.  This  was 
eminently  satisfactory  to  the  growers,  and  under  normal  con- 
ditions would  have  continued  until  the  Socialists  shall  be 
prepared  to  carry  out  their  program  and  abolish  all  profit. 
Under  the  actual  conditions,  as  heretofore  described,  involving 
continual  downward  tendency  in  values,  packers  found  the 
business  too  hazardous,  and,  after  numerous  faikires  had 
occurred,  decided  among  themselves  that  they  would  take  no 
further  risk,  but  would  receive  the  goods  in  the  "sweat-box," 
make  advances  upon  them,  pack  them  at  a  fixed  price,  sell 
them  upon  commission,  and  account  for  the  proceeds.  The 
firms  engaged  in  this  business  became  known  as  "  commission 
packers."  The  result  of  this  was  that  the  commission  packers 
had  to  bear  all  the  odium  of  the  constant  sink  in  the  prices 
of  raisins.  The  growers  did  not  understand  that  their  invest- 
ments in  the  way  of  advances  were  so  heavy  as  to  guarantee 
their  utmost  effort  in  maintaining  values,  or  realize  that  con- 
stant underselling  of  one  by  another  was  largely  a  manifesta- 
tion of  the  pressure  of  those  from  whom  they  had  borrowed 
for  the  benefit  of  the  growers;  nor  would  they  learn  from  some 
serious  failures  among  the  commission  packers,  from  over- 
advances, that  the  pressure  grew  out  of  real  danger  of  loss. 
All  they  could  see  was  that  their  fruit,  when  sold,  sometimes 
did  not  bring  the  sum  advanced  upon  it,  and  very  seldom 
much  more.  Especially  was  this  true  of  w^eaker  growers,  who 
were  usually  found  upon  the  lightest  soil,  and  whose  vineyards 
were  likely  to  have  the  poorest  tillage,  with  the  consequent 
lighter  crops,  and  a  greater  ratio  of  poorer  grapes  bringing 
the  lower  prices.  They  found  loss  and  poverty  their  portion, 
while,  upon  the  whole,  the  commission  packers  prospered,  and, 
with  the  characteristic  common  to  all  unfortunates,  blamed 
everybody  but  themselves  for  their  trouble.  And  there  is  no 
doubt  that,  like  all  embarrassed  persons,  they  paid  far  more 
than  a  due  price  for  service  rendered.  The  packing  charges 
and  commission  rates  generally  charged  were  more  than  the 


460  CALIFORNIA    FRUIT    SOCIETIES. 

able  and  solvent  growers  needed  to  pay  or  did  pay,  and  more 
than  were  customary  in  other  branches  of  the  dried-fruit 
business. 

In  the  raisin  industry,  as  in  the  fresh-fruit  trade,  serious 
trouble  brought  earnest  talk  of  cooperation.  The  growers 
were  exasperated  beyond  measure  at  the  commission  packers 
who  were  serving  them,  and  great  conventions  met  and  resolved 
they  must  and  would  assume  the  marketing  of  their  own  fruit. 
There  were,  however,  practical  difficulties.  The  largest  grow- 
ers, w^ho  had  naturally  had  most  commercial  experience,  were 
not  found  to  work  harmoniously  together ;  the  small  growers 
had  not  the  commercial  experience  or  much  money.  With 
the  commercial  experience  of  the  large  growers  faithfully 
supported  by  small  growers,  money  could  have  been  had  for 
all  legitimate  uses;  capital  was  required  to  erect  and  equip 
packing-houses,  and  the  growers  had  it  not,*  or  at  least  it  could 
only  have  been  raised  by  a  pretty  uniform  assessment  accord- 
ing to  acreage,  which  was  not  found  practicable.  The  han- 
dling of  raisins  after  they  leave  the  sweat-box  involves  two 
distinct  operations  not  necessarily  connected  with  each  other: 
First,  the  packing,  which  requires  a  packing-house  with  its 
equipment,  which  a  cooperative  society  can  manage  with 
perfect  ease;  and,  second,  the  sale  of  the  packed  product,  which 
is  effected  by  brokers  in  eastern  markets;  and  to  direct  this 
well  requires  a  certain  amount  of  commercial  training,  which 
may  or  may  not  be  found  available  in  a  society. 

The  result  of  the  agitation  was  the  formation  of  a  number 
of  cooperative  packing  societies,  which,  with  ordinary  manage- 
ment, should  have  nearly  paid  for  themselves  in  the  saving 
of  packing  charges  each  year.  In  most  cases,  however,  but  a 
small  amount  was  paid  in  on  stock  subscriptions,  and  the 
packing-house  was  left  incumbered  with  all  the  indebtedness 
it  could  be  made  to  carry.  This  impaired  the  credit  of  the 
societies,   who   were    consequently   mostly   unable   to   obtain 


*  It  is  really  absurd,  after  all,  to  say  that  these  growers,  even  indebted  as 
they  were,  could  not  have  raised  the  necessary  funds  to  handle  their  crops,  if 
they  had  chosen  to  do  so. 


rAFJFORNIA    RAISIN    ASSOCIATION.  4>)1 

banking  accommodations  for  advances  to  their  members; 
these,  consequently,  were  compelled,  one  by  one,  to  go  to  the 
commission  packers  for  financial  relief,  which,  of  course, 
involved  taking  their  business  away  from  their  own  packing- 
house, leaving  the  burden  of  supporting  it  to  a  smaller  number 
than  was  anticipated,  and  making  more  or  less  bad  feeling 
between  those  who  "deserted"  and  those  who  stood  by,  and 
having  the  further  result  that,  with  the  diminished  pack,  the 
cost  of  packing  was  more  than  was  expected,  which,  with  the 
interest  and  depreciation,  and  the  more  or  less  bad  manage- 
ment incident  to  new  undertakings,  made  the  outcome,  in 
many  cases,  very  unsatisfactory.  With  freedem  from  debt, 
and  the  improvement  in  management  certain  to  come  willi 
experience,  all  should  have  worked  through,  and  thus  taken 
the  first  step  toward  the  general  union  of  all  raisin  producers, 
which  was  desired;  but,  weighted  down  by  debt,  and  the 
neighborhood  quarrels  which  were  its  result,  nearly  all  the 
cooperative  packing-houses  gradually  fell  into  the  hands  of 
the  commission  packers  by  sale  or  lease.  During  the  season 
of  1894  but  two  of  the  concerns  were  able  to  run  independent 
of  commission  packers,  as  was  intended,  of  which  only  one 
sold  its  own  pack  through  its  own  agencies.  'By  1897  cooper- 
ative selling  had  disappeared,  and  there  was  little,  if  my, 
cooperative  packing. 

The  selling  of  the  product,  as  has  been  pointed  out,  is  an 
entirely  distinct  business  from  packing  it.  As  the  supply  year 
by  year  more  exceeded  the  demand,  the  obtaining  the  orders 
required  more  energy  and  skill,  and  more  expert  judgment 
was  required  in  determining  when  and  at  what  price  to  sell, 
and  the  management  of  the  sales,  in  unskilled  hands,  was  not 
always  wise.  For  the  most  part,  the  conduct  of  the  sales  was 
placed  in  the  hands  of  commission  houses,  usually  in  San 
Francisco,  who  could  obtain  the  necessary  advances,  but  some 
societies  employed  some  of  their  own  members,  sending  them 
east  to  solicit  orders,  which  was  a  good  plan,  if  they  were  sure 
to  retain  the  services  of  those  for  whose  business  education 
they  were  paying.  Upon  the  whole,  however,  the  mercantile 
ability  available   in   their  own  membership  was  not  usually 


462  (JALIFOKNIA    FKUIT    SOCIETIES. 

found  satisfactory,  or  at  least  it  was  insufficient  to  make  the 
business  profitable  in  a  falling  market.  As  it  was  a  prime 
article  of  faith  in  the  raisin  district  that  there  was  "n©  over- 
production"— any  suggestion  of  that  kind  meeting  with  prompt 
resentment — the  blame  for  the  continually  decreasing  net 
returns  inevitably  fell  upon  the  cooperative  management,  just 
as  it  had  before  fallen  on  the  commission  packers.  In  the 
meantime,  however,  one  or  two  well-managed  societies,  either 
out  of  debt,  or  not  involved  beyond  their  means,  and  with 
good  credit  at  their  banks,  for  a  time  proved  helpful  to  their 
members,  but  in  the  end  were  forced  to  succumb. 

It  has  been  the  constant  aim  of  all  cooperative  effort  in  the 
fruit  districts  of  California,  to  concentrate  the  sale  of  the  entire 
crop  under  one  management;  in  plain  English,  to  form  a 
growers'  Trust.  Apparently  the  only  way  in  which  such  a 
result  could  be  reached— if  it  could  be  reached  at  all — was  by 
first  uniting  the  growers  of  the  various  neighborhoods  in 
cooperative  packing  associations  such  as  have  been  described, 
and  then  uniting  the  officers  of  these  societies  in  one  general 
association.  This, however,  requires  time;  it  can  not  be  accom- 
plished in  one  year  or  in  two,  and  the  community,  in  the  face 
of  the  general  distress,  was  never  willing  to  settle  down  to  tlie 
sure  and  slow  process.  For  years  there  was  annually  a  series  of 
mass  conventions,  wherein  were  considered  plans  for  uniting 
all  the  raisin  producers  of  the  state  in  one  organization,  to 
which  each  should  give  his  written  assent,  the  agreement  to 
be  binding  on  the  signers  when  seventy-five  per  cent  of  the 
growers,  or  of  the  acreage,  should  have  signed.  After  each  cf 
those  conventions,  for  some  years  in  succession,  a  new  plan 
was  agreed  upon  and  committees  formed  to  carry  it  aut. 

Those  who  were  most  active  in  forming  these  plans  did  not 
usually  understand  the  practical  difficulties  in  the  wa,'  and, 
not  realizing  the  difficulties,  provided  no  effective  means  for 
overcoming  them.  In  the  first  place,  there  are  nearly  three 
thousand  persons  engaged  in  tlie  industry,  but  a  small  fraction 
of  whom  ever  attend  th«  conventions.  All  these  individuals 
must  be  visited  and  canvassed  in  order  to  obtain  signatures. 
Experience  shows  that,  however  easy  it  may  seem,  there  must 


CALIFORNIA    RAISIX    ASSOCIATION.  463 

be  more  than  a  day's  work  devoted  to  canvassing  for  each  five 
.names  secured;  this  means,  for  canvassing  the  principal  raisin 
district,  at  least  the  equivalent  of  two  full  years  of  work  by  one 
very  competent  person,  besides  conveyances,  railroad  fares, 
hotel  bills,  postage,  printing,  etc.  This  work  must  be  prose- 
cuted in  a  systematic  and  orderly  way,  under  the  superintend- 
ence of  some  capable  person  devoting  Jhis  entire  time  and 
thought  to  the  subject.  Allowing  for  much  volunteer  work, 
a  large  amount  of  paid  service  is  also  required,  as  well  as  funds 
for  general  expenses,  and  no  provision  whatever  was  made  to 
meet  these  expenses.  It  would  seem  that  signatures  could  be 
obtained  very  rapidly  at  the  conventions,  but  American  popu- 
lar conventions  are  assembled  for  talk,  and  talk  they  will  to 
the  last  moment,  and  do  nothing  else;  the  prosaic  work  of 
signing  agreements — which  are  sometimes  present,  prepared 
for  signature — at  once  empties  the  hall.  It  is  found  that 
nothing  but  a  house-to-house  canvass  will  accomplish  any 
considerable  results,  and  the  average  time  taken  with  each 
person  will  be  very  nearly  two  hours.  And  this  was  never 
provided  for.  Another  difficulty  to  be  met  is  the  matter  of 
advances.  A  well-organized  packing  association,  free  from 
debt,  can  manage  this  readily,  with  the  aid  of  the  loeal  banks, 
who  can  deal  with  the  cases  one  by  one  as  they  arise,  among 
them  carrying  the  load  easily,  providing  funds  gradually  as 
needed;  but  when  provision  is  attempted  for  all  in  one  organi- 
zation, it  becomes  a  large  financial  operation,  beyond  the 
means  of  any  local  bank,  and  requiring  the  aid  of  large  cap- 
italists. This  invariably  brings  in  outside  people,  with  or 
without  experience  in  the  raisin  business,  usually  without 
capital  themselves,  but  professing  to  be  able  to  ''interest"  it. 
All  these  were  listened  to,  committee  meetings  held  to  consider 
the  high  finance  of  the  movement,  while  meantime  there  was 
not  a  dollar  raised  to  prosecute  the  organization.  These 
financial  propositions,  when  sifted,  were  always  found  to 
involve  elements  of  security  fortlie  capital  proposed  to  be  sup- 
plied, which  only  a  strong,  thoroughly  organized  society,  witli 
some  capital  of  its  own,  could  give.  While  they  were  discuss 
ing   these   things,  the  organization  did  not  go  on;  one  after 


464  CALIFORNIA   FRUIT   ISOCIETIES. 

another  the  growers'  necessities  drove  them  to  the  commission 
packers  for  advances,  and  the  business  went  on  as  before. 
Sometimes  organizations  were  actually  formed,  but  they  were 
always  in  the  nature  of  a  compact  between  the  commission 
packers  and  a  portion  of  the  growers,  agreeing  to  sell  raisins 
only  at  prices  fixed  by  some  committee  arranged  for  tlie  pur- 
pose. In  practice  the  prices  fixed  were  usually  higher  than 
tlie  market  would  bear,  with  the  result  that  those  outside  the 
organization  sold,  while  those  inside  did  not.  This  at  once 
resulted  in  pressure  from  the  real  owners  of  the  money  invested 
in  advances,  applied  to  the  commission  packers,  through  whom 
the  advances  had  been  made.  This  inevitably  led  to  weakening 
on  the  part  of  some  party  to  the  compact,  and  very  soon  to  a 
complete  breaking  up,  the  remainder  of  tlie  season  being  occu- 
pied in  mutual  accusations  between  the  commission  packers 
in  regard  to  who  first  broke  the  compact,  and  in  renewed  and 
multiplied  curses  of  the  growers  upon  all  of  them;  for  the 
growers  could  not  understand  that  the  same  financial  pressure 
which  compelled  them  to  place  their  products  for  sale  in  the 
hands  of  the  commission  packers,  retaining  no  control  of  the 
prices  at  which  the  goods  should  be  sold,  compelled  the  com- 
mission packers  to  market  them  before  the  falling  market 
should  jeopardize  the  advances.  The  commission  packers 
standing  before  the  growers  in  the  light  of  large  capitalists, 
apparently  preferred  to  incur  the  charge  of  deliberate  bad  faith, 
wliich  was  probably  seldom  deserved,  to  frankly  stating  that 
they  were  as  powerless  as  the  growers  to  hold  the  goods. 

In  this  way  things  kept  annually  going  from  bad  to  worse. 
A  large  portion  of  the  growers  practically  gave  u])  the  fight 
They  would  have  nothing  to  do  with  cooperative  packing  or 
selling,  or  with  commission  packers,  if  they  could  help  it.  The 
one  thought  seemed  to  be  to  put  down  the  prices  of  rai- 
sins in  the  sweat-box  to  a  price  at  which  some  one  would 
buy  them  in  that  condition,  stay  on  their  farms  as  long  as  they 
were  allowed  to  and  could  manage  to  live  there,  and  when 
they  must,  to  move  oflt'  and  begin  life  over  again.  This  was 
real  distress,  and  it  was  widespread,  for  indebtedness  was 
general.    There  were  some  foreclosures,  but  they  were  com- 


CALIFORNIA   RAISIN   ASSOCIATION.  465 

paratively  few,  for  the  banks  could  do  nothing  with  property 
for  which  there  was  no  sale,  and  they  did  not  care  to  draw 
public  attention  to  the  financial  condition  of  the  district.  In 
some  cases  farmers  packed  up  and  abandoned  their  mortgaged 
vineyards.  In  many  more,  they  confessed  to  the  banks  that 
they  could  not  pay  either  principal  or  interest,  and  offered  to 
convey  the  property  if  the  debt  were  released.  These  were 
all  urged  to  remain  and  pay  what  they  could,  or  nothing. 

The  time  was  now  ripe  for  real  cooperative  work.  Not 
only  were  small  raisin-growers  in  real  distress,  but  the  largest 
financial  interests  of  the  raisin  districts  had  become  tlior- 
oughly  alarmed.  The  banks  were  all  strongly  connected,  and 
well  managed,  and  there  was  apparently  no  fear  of  their  sol- 
vency ;  but  one  small  San  Francisco  savings  bank,  which  had 
placed  most  of  its  funds  in  mortgages  in  the  district,  made  a 
disastrous  failure.  Other  banks  and  capitalists  had  large 
landed  interests  in  the  valley,  which  were  rapidly  depreci- 
ating in  value.  The  entire  mercantile  community  was  seri- 
ously involved,  although  for  a  long  time  credits  had  been 
curtailed  or  refused,  and  cash  payments  demanded  for  mer- 
chandise. Real  estate  in  the  towns  became  unsalable,  and 
mortgage  foreclosures  on  improved  property  were  frequent. 
The  most  capable  and  influential  men  of  the  community 
realized  that  tlie  time  had  passed  when  the  strong  could  safely 
regard  only  their  own  interests,  but  that  all  must  unite  in 
effort  for  the  general  prosperity,  in  which  only  lay  the  hope  of 
prosperity  for  any  one. 

In  the  spring  of  1898,  according  to  the  annual  custom,  a 
mass-meeting  of  raisin-growers  was  called  to  devise  a  plan  of 
organization.  These  proposals  had  always  had  the  support 
and  counsel  of  the  financial  men  of  the  valley,  who  usually 
agreed  very  well  in  their  advice,  but  could  never  prevail 
against  the  contentions  and  jealousies  which  divided  the  mass 
of  the  growers,  and  which  had  often  been  fostered  by  many  of 
the  commission  packers,  wlio  did  not  desire  that  their  business 
should  be  in  any  way  interfered  with,  and  who,  by  advances, 
or  actual  ownership,  controlled  an  acreage  sufficient  to 
prevent  any  effective  combination  to  which  they  were  not  a 
30 


466  CALIFORNIA   FRUIT   SOCIETIES. 

party.  In  1888,  however,  the  commission  packers  themselves, 
who,  of  course,  were,  as  a  class,  just  as  good  citizens  as  the 
members  of  other  classes,  and  of  whom  some  had  always 
favored  efforts  of  the  growers  to  organize  themselves,  were  as 
strongly  convinced  as  others  of  the  necessity  of  united  action, 
and  were  ready  to  put  the  acreage  which  they  influenced  or 
controlled  into  any  combination  which  did  not  endanger  their 
large  investments  in  buildings  and  packing  machinery,  or  take 
from  them  the  mercantile  business  which  they  had  been  years 
in  building  up.  Wliat  they  desired  was  that  they  should  be 
permitted  to  continue  to  do  the  packing  for  the  growers  at  the 
prices  which  had  been  usually  paid,  and  to  continue  to  do  the 
selling  at  the  customary  commission.  With  these  essentials 
granted,  they  were  willing  that  an  organization  of  growers 
should  control  pretty  much  everything  else,  including  the 
fixing  of  the  prices,  and  were  ready  to  enter  into  such  con- 
tracts with  the  growers'  organization  as  should  assure  to  the 
latter  complete  control  of  tlie  business.  They  were  also  will- 
ing to  continue  to  employ  their  capital  and  credit  in  advances 
to  growers,  and  generally  to  accept  the  situation  of  agents  of 
the  growers,  employed  to  pack  and  sell  goods,  and  subject,  in 
these  matters,  to  the  control  of  their  employers,  who,  in  turn, 
must  accept  full  responsibility  for  results,  and,  in  the  main, 
for  the  financing  of  the  enterprise.  The  packers,  of  course, 
could  not  and  did  not  object  to  growers  packing  their  own 
raisins,  or  to  the  employment  of  such  cooperative  packing 
plants  as  were  in  existence,  but  did  object  to  systematic  and 
aggressive  action  on  the  part  of  the  organization  to  increase 
the  number  of  such  plants.  Upon  this  point  there  was  no 
explicit  agreement,  but  it  was  doubtless  tacitly  understood 
upon  both  sides. 

It  is  unnecessary  to  detail  the  conventions  and  meetings 
and  consultations,  public  and  private,  by  which  organization 
was  effected  substantially  upon  these  lines.  The  packers 
formed  an  organization  of  tlieir  own,  and  the  public  move- 
ments were,  doubtless,  largely  based  u})on  private  understand- 
ings, more  or  less  informal  and  indefinite,  between  the  leaders 
of  the  two  parties.      In  several  mass-meetings  of  the  growers 


CALIFORNIA    IIAISIN    ASSOCIATION.  467 

a  form  of  organization  was  elaborated  and  agreed  upon,  and 
leading  growers  selected  to  incorporate  the  society  and  serve 
as  directors  for  the  first  year.  This  done,  a  form  of  contract 
was  prepared  to  be  signed  by  individual  growers,  which  gave 
to  the  California  Raisin  Association  absolute  control  of  the 
crop  of  1898.  The  contracts  of  growers  whose  crops  were 
mortgaged  for  advances  must  be  endorsed  by  the  mortgagee, 
whose  claim  would  be  satisfied  by  the  association.  A  care- 
fully prepared  list  of  raisin-growers  and  acreage  was  made, 
and  tlie  contracts  were  not  to  be  binding  until  signed  by 
owners  of  at  least  seventy-five  per  cent  of  the  acreage.  They 
were  then  to  become  binding  upon  the  growers  who  had 
signed,  after  which  the  association  had  a  certain  time  in 
which  to  exercise  its  option  wliether  or  not  it  would  accept 
the  contracts  and  itself  sign.  This  was  for  the  purpose  of 
permitting  the  association  to  complete  its  contract  witli  the 
packers,  which  could  not  be  done  until  the  association  itself 
had  something  to  deliver. 

The  movement,  as  stated,  had  the  support  of  all  the  large 
growers  but  one  or  two,  and  of  the  entire  mercantile  and 
financial  elements.  An  active  canvass  was  commenced,  and  in 
due  time,  and  after  the  greatest  effort  on  the  part  not  only  of 
the  directors  but  a  large  n amber  of  otliers,  the  requisite  per- 
centage was  secured,  and,  after  further  protracted  negotiations 
between  the  association  and  the  packers,  a  committee  of  disin- 
terested bankers  being  frequently  called  in  to  arbitrate  upon 
matters  of  detail,  the  contracts  on  all  sides  were  closed,  and 
the  association  began  business.  It  is  unnecessary  to  follow 
the  history  further.  The  details  of  the  management  would 
hardly  be  understood  by  the  general  reader,  without  lengthy 
explanations,  and  are  not  essential.  Like  all  new  enterprises, 
the  association  had  its  troubles,  not  the  least  of  which  were 
underselling  by  the  few  who  did  not  sign,  and  who  had  no 
confidence  in  the  ability  of  the  association  to  sustain  itself, 
and  who  wished  to  avoid  the  avalanche  which  they  expected 
to  follow  its  speedy  dissolution.  But  the  affairs  of  the  asso- 
ciation were  in  the  hands  of  men  of  great  ability.  They 
established   a   thorough   system  of  inspection  and  branding, 


468  CALIFORNIA    FKUIT    SOCIETIES. 

and  the  association  brand  at  once  commanded  a  preference,  as 
a  guaranty  of  an  honest  pack.  The  directors  had  the  confi- 
dence of  the  banks,  and  thus  could  command  capital,  and  when 
foolish  men  put  their  goods  on  the  market  at  cut  prices,  the 
association,  through  its  brokers,  secretly  bought  them  in, 
inspected  and  branded  them,  and  resold  them  at  a  profit,  thus 
making  a  laughing  stock  of  the  outsiders.*  The  prices  fixed 
were  very  reasonable,  not  such  as  would  pay  interest  on 
inflated  values  of  property,  but  such  as  thrifty  men  could  live 
by  and  save  a  little.  Interest  was  generally  paid  on  mort- 
gages ;  old  store  bills  were  paid  off.  Some  who  had  exception- 
ally good  crops  paid  off,  or  made  payments  on,  mortgages. 
The  sum  distributed  to  growers  up  to  April  1,  1899,  was  two 
cents  per  pound  for  average  raisins  in  the  sweat-box,  a  rate 
which  no  more  than  pays  costs  on  the  poorer  lands,  with  a 
further  dividend  to  be  expected  later. 

In  1899,  the  contracts  having  been  for  but  one  year,  a  new 
canvass  was  begun,  this  time  for  two-year  contracts,  which,  at 
the  time  when  these  pages  are  printed,  is  understood  to  have 
been  successful.  The  association  itself  has  reorganized  for 
convenience,  under  another  law.  The  new  contract  with  the 
packers  involves  a  reduction  of  twenty-five  per  cent  in  packing 
charges,  and  nearly  thirty-three  and  one-third  per  cent  in 
commissions  on  sales,  with  more  stringent  regulations  for  the 
prevention  of  irregular  practices.  These  reductions  involve 
very  large  sums,  and  show  the  effectiveness  of  organized 
action  and  financial  independence.  They  appear  to  have 
been  a  compromise  on  the  part  of  the  packers  to  prevent  a 
proposed  increase  of  cooperative  packing. 

The  history  of  cooperation  among  raisin-growers  very  well 
illustrates  the  manner  in  which  all  classes  whose  interests  con- 
flict, may,  and  in  the  future  are  generally  likely  to,  compro- 


*  This  was  a  very  dangerous  departure  from  the  principles  of  cooperative 
marketing,  justified,  if  at  all,  by  the  peculiar  circumstances  of  the  case,  and  the 
exceptional  ability  of  those  particular  directors.  They  did  not  err  in  judg- 
ment of  values,  but  some  other  board  might.  It  will  not  do  to  let  outsiders  get 
the  idea  that  they  can  force  the  cooperators  to  buy  their  products. 


CALIFORNIA    RAISIN    ASSOCIATION.  469 

mise  upon  clear-cut  agreements  to  mutual  advantage.  The 
commission  packers  are  doing  work  which  must  be  done  by 
somebody,  and  for  which  they  are  at  present  bettor  equipped 
than  the  growers.  They  have,  doubtless,  been  getting  higher 
pay  for  their  services  than  the  bnsinessjustified,  but  it  required 
only  united  action  by  the  growers  to  secure  rates  which  are 
entirely  reasonable. 


CHAPTER    V. 

THE   DRIED   FRUIT   AND    NUT    ASSOCIATIONS. 

ALMOST  simultaneously  with  the  beginnings  of  coopera- 
tive effort  in  the  San  Joaquin  raisin  district,  producers 
of  dried  fruit  in  Santa  Clara  County  evolved  a  class  of 
organizations  which  have  thus  far  proved  very  successful,  al- 
though they  have  never  yet  controlled  the  crop,  or  approached 
the  effectiveness  of  a  Trust.  Although  originating  in  Santa 
Clara  County,  the  example  has  been  followed  in  all  parts  of 
the  state,  and  there  are  now  a  large  number  in  successful 
operation.  These  societies  do  not  differ  in  principle  from  the 
cooperative  raisin-packing  societies  already  described,  but  they 
were,  for  some  years,  far  more  successful  than  those  societies, 
mainly  for  the  reason  that,  situated  in  the  midst  of  an  older 
and  richer  community,  they  have  had  no  financial  trouble. 
They  also  had  the  advantage  of  beginning  while  the  fruit 
business  was  still  remunerative,  and,  while  they  have  not  been 
able;  to  arrest  the  downward  movement  in  prices,  inevitably 
following  the  enormously  rapid  increase  of  production,  they 
have  greatly  steadied  the  descent,  and  assisted  to  equalize  the 
pressure  among  all  engaged  in  the  business.  Their  character 
and  methods  will  be  better  understood  after  a  brief  description 
of  the  dried-fruit  business. 

The  Santa  Clara  A^alley  lies  south  of  the  southern  arm  of 
the  Bay  of  San  Francisco,  San  Jose,  the  commercial  center 
of  the  valley,  being  fifty  miles  distant  from  the  city  of  San 
Francisco.  Originally  a  great  wheat  field,  some  of  its  inhab- 
itants were  prompt  to  see  tlie  attractions  of  the  fruit  business, 
and  to  engage  in  it.  The  plums  known  to  commerce  as 
"prunes"  were  found  to  succeed  admirably,  and  large  areas 
were  rapidly  planted  to  these  trees,  as  well  as  to  apricots, 
peaches,  pears,  and,  in  fact,  nearly  all  deciduous  fruits;  but 
the  prune  was  largely  in  the  lead.     The  apricot  grows  and 

(470) 


DRIED    FRUIT    AND    NUT    ASSOCIATIONS.  471 

bears  well,  but  is  longer  maturing  than  elsewhere  in  the  state, 
thereby  obtaining  a  thicker  and  firmer  flesh,  but  ripening 
too  late  for  profitable  shipping,  as  the  apricot,  fresh,  does  not 
sell  well  in  competition  with  peaches,  excellent  varieties  of 
which  are  in  the  market  from  the  earlier  districts  before  the 
Santa  Clara  apricots  are  ready.  The  peaches  and  pears,  also, 
from  this  district  are  said  not  to  bear  the  long  overland  jour- 
ney so  well  as  fruit  from  interior  districts.  These  conditions, 
with  the  fact  that  the  prune,  whicli  is  almost  exclusively  a 
drying  fruit,  was  the  largest  fruit  product  of  the  valley, 
naturally  led  to  the  drying  or  canning  of  the  greater  portion 
of  the  crop.  This  business  for  some  years  proved  very  profit- 
able, and  the  industry  increased  until  large  districts  in  the 
valley  were  almost  completely  covered  with  orchards  ranging 
in  size  from  five  acres  to  three  hundred  acres,  and  San  Jose 
became  by  far  the  largest  shipping-point  in  the  state  for  dried 
fruits;  of  prunes,  especially,  it  supplied  for  some  years  almost 
the  entire  output  of  the  state,  and  while,  with  the  enormous 
increase  of  the  industry  elsewhere,  its  relative  importance  in 
the  trade  has  diminished,  as  late  as  1893  there  were  shipped 
from  San  Jose  seventy-five  per  cent  of  the  prunes  and  twenty- 
five  per  cent  of  all  the  other  dried  fruits  exported  from 
California. 

The  fruit  for  drying — except  prunes — is  pitted,  under  sheds, 
placed  on  shallow  wooden  trays  usually  three  by  eight  feet, 
bleached  by  exposure  to  sulphur  fumes,  and  then  dried  in  the 
sun.  Prunes,  of  course,  are  neither  pitted  nor  bleached.  To 
secure  uniformity  in  drying,  prunes  are  graded  by  machinery 
before  drying,  and  other  fruits  either  by  machinery  or  by 
hand.  To  handle  the  pitted  fruits  properly,  a  good  deal  of 
extra  labor  is  required,  and  a  few  days  of  unusually  hot 
weather  coming  on  may  require  the  picking  and  pitting  force 
to  be  suddenly  doubled  in  order  to  save  the  fruit,  and  this 
extra  labor  is  ngt  always  available  when  needed.  Considerable 
vacant  space  must  be  left  in  the  orchard  for  drying  ground, 
and  on  small  farms  this  space  was  grudged  from  the  orchard. 
The  investment  in  trays  and  machinery  was  consideral^le  if 
the  fruit  was  to  be  properly  cared  for,  ana  the  labor  of  feeding 


472  CALIFORNIA    FRUIT    SOCIETIES. 

and  caring  for  the  extra  help  bore  heavily  on  the  women  of  the 
household.  There  grew  up,  therefore,  very  naturally,  a  class 
of  local  dealers  located  near  shipping-points  and  where  labor 
was  available,  who  bought  the  fruit,  picked  and  delivered  at 
their  grounds,  where  it  was  dried  and  marketed.  This  had 
the  advantage  to  the  grower  of  giving  him  his  money,  in  full, 
at  oiice,  and  relieving  him  of  the  burden  of  securing  help 
except  for  picking,  and  it  was  good  for  the  industry  in  that 
the  average  quality  of  the  dried  product  was  better  than  if 
dried  by  a  hundred  persons,  mostly  unskilled  and  imperfectly 
provided  with  appliances.  The  evil  of  it  was  that  the  growers, 
being  at  such  a  distance  from  tlie  great  markets,  and  usually 
having  to  sell  before  the  prices  of  the  season  were  fully  estab- 
lished, and,  moreover,  being  generally  not  well  informed  as  to 
the  usual  shrinkage  in  drying,  were  at  a  great  disadvantage 
with  the  more  astute  and  better-informed  buyers.  It  was  also 
true  that  the  buyers  were  accustomed,  at  the  beginning  of 
the  season,  to  scour  the  district  in  search  of  growers  whose 
debts  pressed  them,  and  with  whom  hard  bargains  could  be 
driven  by  the  temptation  of  a  certain  amount  of  ready  cash 
paid  down;  and  a  few  sales  of  this  kind  having  been  made, 
under  pressure,  the  season's  prices  became  pretty  firmly  estab- 
lished, and  it  was  hard  to  raise  tliem,  the  result  being  that 
the  prices  for  all  the  crop  were  set  by  that  portion  of  the 
growers  who  were  the  least  competent  to  judge  of  its  value,  or 
insist  on  receiving  it.  Undoubtedly  there  was  another  side 
to  the  question,  for  it  often  happened,  especially  in  years  of 
short  crops,  that  competition  among  buyers  rapidly  ran  prices 
up,  with  the  result  of  serious  losses  to  the  buyers,  and  some- 
times failure.  In  some  cases  the  loss  from  failure  of  buyers 
fell  upon  growers  who  sold  n})on  short  time,  intending  to  give 
the  buyer  opportunity  to  dry  and  sell  before  payment.  The 
fruit  dried  on  the  farms  was  also  largely  purchased  by  those 
engaged  in  drying,  as  well  as  by  others,  who  visited  the 
orchards,  and  bought  and  paid  for  tlie  fruit  on  delivery  at 
the  packing-houses,  where  it  was  graded  and  sold  in  ear-load 
lots  to  the  trade. 

As  a  result  of  this  system,  a  feeling  of  animosity  grew  up 


DRIED    FRUIT    AND    NUT    AS,SO(;iATIONS.  473 

among  the  growers  toward  the  buyers  of  their  product,  not, 
however,  by  any  means  so  intense  as  that  among  the  raisin- 
growers  towards  the  commission  packers.  The  feeling,  how- 
ever, was  less  intense  only  for  the  reason  that  the  growers 
were  in  better  circumstances,  and  at  the  time  were  receiving 
better  prices  than  the  raisin  men  were  obtaining,  and  also,  as 
a  rule,  were  actually  selling  and  getting  the  money  at  some 
price,  the  increasing  production  not  having  then  so  demoral- 
ized markets  as  to  drive  local  buyers  from  the  field,  although 
it  was  beginning  to  make  them  cautious,  and  their  growing 
unwillingness  to  meet  the  views  of  growers  was  leading  an 
increasing  number  of  growers  to  consign  their  goods  east  in 
the  expectation — almost  never  realized — of  obtaining  better 
results. 

Under  these  conditions,  during  the  winter  of  1890-1891  a 
movement  originating  in  one  or  two  local  societies  of  fruit- 
growers led  to  the  organization,  in  a  fruit  district  near  Santa 
Clara,  of  the  West  Side  Fruit  Union,  a  cooperative  society  for 
drying,  packing,  and  marketing  the  fruit  of  its  stockholders. 
The  plan  accepted  the  principle  of  bringing  the  fruit  for  drying 
to  tlie  drying-grounds  of  the  society,  thus  concentrating  the 
fruit  for  shipment  in  car-load  lots,  and  so  performing  one  of 
the  functions  of  the  local  buyer.  But  it  added  other  features. 
The  buyers,  after  receiving  and  paying  for  the  fruit,  graded  it, 
and  packed  it  according  to  grade,  and  not  in  lots  as  purchased, 
and  as  they  bought  as  cheaply  as  they  could,  and  at  varying 
prices,  different  growers  received  different  prices  for  fruit  which 
went  into  the  same  bin;  this  grading  was  necessary,  and  as  the 
detail  of  keeping  each  owner's  lot  of  each  grade  separate  was  very 
great,  and  as  prices  would  vary  more  or  less  during  the  season, 
so  that  if  kept  separate  one  person  was  sure  to  get  more  than 
another  for  the  same  grade,  the  union  determined  to  make  no 
attempt  to  keep  lots  separate,  but  to  grade  the  fruit  as  brought, 
giving  receipts  for  the  quantity  of  each  grade,  and  then  selling 
as  if  the  product  of  one  owner.  At  the  end  of  the  season  each 
owner  received  in  payment  for  each  grade  of  his  fruit  the 
average  price  received  during  the  season  for  that  grade.  As 
the  season  went  on,  and  sales  were  made,  growlers  received 


474  CALIFORNIA    FRUIT    SOCIETIES. 

money  on  account  as  was  required;  final  settlement  was  made 
when  all  was  sold.  The  plans  of  the  association  were  elastic, 
and  any  grower  who  preferred  to  dry  his  fruit  at  home  might 
do  so,  and  bring  it  dried  to  the  packing-house,  where  it  was 
graded  and  then  mingled  with  the  fruit  dried  by  the  society. 
The  accounts  were  so  kept  that  the  expenses  of  selling  were 
shown  separately  from  those  incurred  in  drying,  and  the  grower 
bringing  his  fruit  dried  was  charged  only  for  the  expense  of 
selling. 

The  society,  of  course,  was  incorporated,  the  par  value  of 
the  shares  being  $25,  all  of  which  was  paid  in  at  once  or 
during  the  season.  The  idea,  being  new  to  most  growers,  was 
received  as  new  ideas  are  generally  received  by  the  public, 
who  were  quite  ready  to  meet  at  the  schoolhouses  and 
approve  them  by  resolution,  but  extremely  slow  to  sign  their 
names  to  subscriptions  to  stock.  The  promoters,  liowever, 
were  not  easily  discouraged,  and,  being  all  men  of  substance 
and  standing  in  the  community,  eventually  succeeded  in 
selling  the  required  amount  of  stock,  divided  among  some 
eighty  or  more  orchardists,  some  of  whom  lived  too  far  away  to 
ever  expect  to  make  use  of  the  organization,  but  benevolently 
gave  the  $25  "to  help  it  along,"  never  expecting  to  see  their 
money  again.  It  was  intended  that  stock  subscriptions  should 
be  made  upon  the  basis  of  acreage  in  orchard,  and  to  a  certain 
extent  this  was  done,  but  as  success  was  earnestly  desired,  the 
promoters  were  not  very  particular,  in  consequence  of  which 
some  "benevolent"  growers  obtained  for  |25  the  privilege  of 
drying-grounds  and  plant  for  large  orchards  which  they  could 
not  have  provided  by  themselves  for  fifty  times  the  money. 
Ten  acres  of  land  were  purchased,  a  building  erected,  trays 
and  machinery  provided,  and  in  the  fall  of  1891  the  associa- 
tion was  ready  for  business. 

The  stockholders  were  afraid  to  trust  their  own  business 
agency.  Of  eighty  or  more  who  had  undertaken  to  cooperate, 
but  five  or  six  were  found  ready  to  intrust  their  fruit  to  the 
care  of  the  men  of  their  choice,  and  their  servants.  What 
they  were  afraid  of  it  would  be  hard  to  say,  Init  they  were 
afraid.     Especially  they  disliked  pooling  their  fruit  with  that 


DRIED    FRITIT    AXD    NUT    ASROfTATIONS.  4/0 

of  their  neighbors;  ahnost  every  one  was  of  the  opinion  that 
his  fruit  was  better  than  that  of  his  neighbors,  and  that  lie 
would  somehow  lose  if  he  allowed  it  to  lose  its  identity. 
Fruit  prices  opened  that  year  at  what  was  considered  a  mod- 
erately fair  rate,  although  lower  than  the  year  before,  and  one 
by  one  the  stockholders  sold  out.  It  began  to  look  serious, 
for  the  plan  of  operation  involved  the  agreement  that  interest 
at  eight  per  cent  upon  all  stock  issued  should  be  charged  as 
an  item  of  expense,  against  the  fruit  handled,  and  it  began  to 
appear  as  if  the  fruit  of  a  very  few  growers  would  have  to  bear 
the  entire  interest  charge  upon  the  cost  of  a  plant  large 
enough  to  handle  ten  times  the  quantity.  Fortunately  for 
the  society,  it  was  a  year  of  large  fruit  crops,  and  the  buyers 
soon  began  to  get  enough,  and  prices  began  to  fall,  and  when 
they  reached  a  point  lower  than  fruit  had  ever  before  brought 
in  the  valley,  the  few  who  had  not  sold  out,  agreed,  with  some 
apparent  misgivings,  to  patronize  their  own  business,  instead 
of  competing  with  it.  In  all  there  were  seventeen  out  of  the 
eighty  who  took  the  fearsome  venture.  The  fruit  was  dried 
and  sold,  and  when  settlement  was  made,  it  was  found  that 
those  who  had  been  so  reckless  as  to  trust  themselves  with 
their  own  product,  had  all  made  a  handsome  gain  as  com- 
pared with  the  average  of  those  who  refused  to  stand  by,  and 
that  in  the  face  of  bearing  the  burden  of  interest  on  all  the 
stock.  The  result  was  so  encouraging  that  the  next  year 
nearly  one-half  of  the  stockholders  had  the  full  courage  of 
their  convictions,  and  marketed  the  fruit  through  the  associa- 
tion. It  was  a  short  crop,  but  buyers  0{)cned  the  market  with 
very  moderate  offers,  but  prices  went  up  towards  the  close  of 
the  season  to  as  high  a  figure  as  they  had  ever  reached — $00 
a  ton  for  fresh  prunes,  which,  if  it  could  be  had  regularly, 
would  soon  make  millionaires  of  the  growers.  At  this  figure  it 
was  almost  impossible  to  hold  the  stockholders,  and  many  of 
them  sold ;  indeed,  some  had  done  so  long  before,  at  $40  to 
$48  per  ton.  When  the  settlement  was  made  by  the  associa- 
tion, however,  an  average  of  $85  per  ton,  fresh,  was  distributed 
after  paying  all  expenses.  Another  similar  society  which  had 
that  year  been  started  near  by,  had  a  similar  experience,  and 


476  CALIFORNIA    FRUIT   SOCIETIES. 

the  whole  Santa  Clara  Valley  went  wild  over  the  profits  of  the 
prune  business,  and  the  profits  of  cooperation. 

As  a  matter  of  fact,  the  phenomenal  results  of  coopera- 
tion in  that  year  could  never  have  been  anticipated,  and  can 
hardly  occur  again.  The  prune  crop  was  very  short,  and 
prices  very  higli,  but  the  principal  gain  to  the  drying  associa- 
tions arose  from  the  phenomenally  small  shrinkage  in  drying 
which  occurred  in  that  year,  and  which  made  the  returns  per 
ton  of  fresh  fruit  exceedingly  high,  although  the  crop  was  so 
short  that  the  incomes  of  the  growers,  while  large,  were  not  at 
all  beyond  reason.  Many  of  those  who  dried  their  own  fruit 
at  home,  and  sold  independently,  did  nearly  or  quite  as  well 
as  those  who  sold  through  the  two  drying  associations,  for  all 
the  information  and  acts  of  the  unions  were  public,  and 
imparted  as  freely  to  outsiders  as  to  their  own  members,  and 
all  growers  who  used  reasonable  diligence  could  through 
them  be  perfectly  informed  of  market  conditions,  and  obtain 
full  prices,  as  the  demand  was  brisk  and  there  was  no  diffi- 
culty in  making  sales.  There  were,  of  course,  many  who  were 
not  informed  and  who  got  less  than  the  associations,  but  it 
was  their  own  fault.  What  the  associations  did  do,  however, 
was  to  demonstrate  the  fact  that  it  was  unwise  to  sell  the  fruit 
before  drying,  because  in  the  long  run,  and  one  j^ear  with 
another,  there  was  a  profit  in  drying  which  the  grower  could 
not  afford  to  lose,  although  it  was  also  doubtless  true  that  an 
experienced  grower  could  often  sell  his  fruit,  fresh,  to  an 
inexperienced  buyer  for  more  than  its  value;  in  the  long  run 
the  odds  were  against  the  grower,  and  he  did  better  to  dry  his 
own  fruit,  either  at  home  or  through  a  cooperative  association. 
It  also  seemed  clear  that  a  grower,  with  drying-grounds  and 
appliances,  who  made  no  account  of  the  wear  and  tear  of  these, 
or  of  his  own  time,  or  that  of  his  family  and  teams,  could 
show  a  less  net  cost  of  .drying  than  the  cooperative  associa- 
tions would  show;  but  if  he  included  in  his  cost  the  actual 
worth  of  these  items,  his  net  cost  of 'drying  would  be  greater; 
but  it  became  very  evident  that  the  average  quality  of  tlie 
fruit  dried  cooperatively  was  far  better  than  the  average  of  the 
same  fruit  home-dried,  although  no  better  than,  if  so  good  as. 


DRIED    FRUIT    AND    NTT    ASSOCIATIONS.  477 

the  product  of  the  most  skilful  and  painstaking  growers.  It 
was  evident  that  the  gain  to  the  stockholders  in  the  one  year 
1892  far  more  than  repaid  the  total  cost  of  the  cooperative 
establishments,  so  that  even  if  no  further  use  should  be  made 
of  them  there  had  still  been  a  profit,  but  the  greatest  gain  of 
all  was  in  the  diffusion  among  growers  of  definite  knowledge 
of  their  own  business,  including  the  normal  shrinkage  in 
drying  of  all  fruits,  the  best  methods  of  manipulation,  the 
necessity  and  profit  of  painstaking  in  every  step  of  growing 
and  preparing,  and  the  beginnings  of  an  intelligent  study  of 
marketing.  No  one  has  ever  questioned  the  economic  value  of 
these  drying  associations.  •  In  districts  where  orchards  are  too 
much  scattered,  they  are  not  possible,  as  the  ripe  fruit  can  not 
be  carried  over  two  or  three  miles  in  wagons  without  too  much 
bruising  and  waste,  and  the  expense  of  hauling  the  fruit 
before  drying  will  average  four  or  five  times  the  cost  of  haul- 
ing the  dried  product. 

In  the  spring  of  1892  the  promoters  of  cooperative  organi- 
zation, encouraged  by  the  success  of  the  first  year's  work  of 
the  drying  association,  called  a  mass-meeting  of  fruit-growers, 
which  was  held  in  April,  in  San  Jose,  and  was  largely  attended, 
the  largest  hall  in  the  city  being  crowded  to  overflowing. 
The  discussions  at  the  meeting  developed  a  wonderful  igno- 
rance among  the  growers  as  to  almost  everything  connected 
with  their  business,  beyond  the  actual  growing  of  the  fruit. 
The  wildest  statements  were  made,  and  the  most  glowing  pre- 
dictions were  ventured,  as  to  the  results  to  be  expected  from 
cooperation.  The  meeting  lasted  all  da}',  resulting  in  a  reso- 
lution to  effect  an  organization  which  should  embrace  the 
entire  district  tributary  to  San  Jose  as  a  shipping-point,  and 
which  should  market  the  product  of  the  drying  associations 
formed  and  to  be  formed,  together  with  that  of  individuals 
drying  their  own  fruit,  and  a  committee  was  raised  to  formu- 
late a  plan  to  be  reported  to  an  adjourned  meeting.  In  due 
time  this  committee  reported  articles  of  incorporation  and 
by-laws  to  the  adjourned  meeting  of  the  convention,  which, 
although  not  more  than  half  so  large  as  the  first,  was  enthu- 
siastic and  united,  and,  having  agreed  upon  the  form  of  the 


478  CALIFORNIA   FRUIT   SOCIETIES. 

articles,  selected  nine  persons  to  serve  as  directors,  and  pledged 
subscriptions  of  stock  to  the  amount  of  about  $2,000  of  the 
$200,000  which  was  proposed  as  the  capital  to  be  raised.  It 
was  intended  to  interest  the  local  buyers  in  the  movement, 
and  four  of  tlie  nine  directors  were  of  that  class.  They  were 
bright  men  and  always  served  the  Exchange  faithfully,  giving 
freely  of  their  experience  in  perfecting  the  organization,  and 
subsequently  in  the  conduct  of  the  business,  which,  indeed, 
without  their  help,  would  have  been  exceedingly  awkward  at 
first,  but  the  inveterate  hostility  of  most  growers  towards  all 
the  customers  for  their  goods  always  made  their  presence  on 
the  board  of  directors  a  sort  of  weakness,  by  exciting  distrust 
of  the  management.  The  organization  thus  formed  is  known 
as  the  Santa  Clara  County  Fruit  Exchange,  and  is  one  of  the 
best  known  and  most  successful  societies  in  the  state. 

The  directors  incorporated,  as  directed,  in  May,  and  imme- 
diately, through  the  press  and  by  circulars,  requested  the 
enthusiastic  growers  who  directed  the  organization,  to  send  in 
their  subscriptions  for  stock.  Not  a  single  dollar,  not  a  single 
subscription,  ever  came  in  as  the  result  of  this  effort,  except 
one  from  an  enthusiast  in  a  distant  count}^  who  sent  his 
subscription  for  ten  shares,  and  a  check  for  $100  to  pay  for 
them,  although  he  could  never  hope  to,  and  never  did,  receive 
any  advantage  from  the  society  except  such  information  about 
markets  as  it  could  give  him.  The  thousand  growers  who 
shook  the  rafters  with  their  cheers  at  the  first  meeting 
remained  silent  as  the  grave  when  the  time  came  to  supply 
the  money;  and  it  was  not  from  poverty,  as  they  were  mostly 
prosperous  and  well-to-do.  It  very  soon  became  evident  that 
the  Exchange  could  not  get  ready  for  business  that  year, 
which  was  the  less  needful  as  it  was  a  year  of  short  crops  and 
full  prices,  with  no  difficulty  in  selling  at  very  profitable  rates. 
The  directors,  however,  continued  to  meet  regularly,  studying 
the  business  and  perfecting  plans,  and  endeavoring  as  they 
could  to  obtain  stock  subscriptions.  The  press  of  the  county 
gave  its  columns  freely  to  the  movement,  so  that  the  subject 
was  for  a  time  kept  before  the  people,  but  in  the  last- of 
October,  at  the  end  of  the  fruit  season,  not  only  had  no  prog- 


DRIED    FRUIT    AND    NUT    ASSOCIATIONS-  479 

ress  been  made  in  getting  mone}^  but  the  very  memoiy  of  the 
movement  begun  so  enthusiastically  had  almost  faded  from 
the  public  mind. 

The  directors,  however,  were  determined  men,  and  some  of 
them,  especially,  were  so  prominently  and  publicly  connected 
with  the  movement  that  they  could  not,  without  great  morti- 
fication, see  it  fail.  It  was  determined,  since  volunteer  effort 
produced  no  results,  and  there  was  none  of  their  number  who 
was  able  to  leave  his  own  business,  without  compensation,  to 
visit  the  individual  growers,  to  see  what  could  be  done  by 
paid  service,  and  one  of  the  directors  was  chosen  manager,  at 
a  moderate  compensation,  and  instructed  to  proceed  and  com- 
plete the  organization,  which  he  accordingly  did,  but  instead 
of  accomplishing  it  in  a  few  weeks,  as  was  expected,  fully  six 
months  were  required,  during  which  the  manager  received 
some  paid  and  a  great  deal  of  volunteer  assistance.  It  was 
found  that  the  growers  wiio,  when  assembled  in  convention, 
seemed  ready  to  mortgage  their  farms  for  the  sake  of  coopera- 
tion, would  do  absolutely  nothing  towards  establishing  the 
business,  except  as  solicited  with  the  same  tact  and  vigor  that 
is  required  in  selling  patent  rights.  The  exceptions  were  too 
few  to  be  taken  into  account.  At  the  end  of  six  months  some- 
thing over  $18,000  of  stock  subscriptions  had  been  secured, 
at  the  cost  of  over  $1,400,  including  all  the  preliminary 
expenses,  and  the  total  number  of  subscribers  was  less  than 
the  number  present  at  the  conventions,  where  they  could  have 
subscribed  with  no  expense  to  anybody.  The  average  cost  of 
a  subscription  was  $3.00,  exclusive  of  time  spent  by  volunteer 
canvassers.  Three  hours  of  earnest  work  was  frequently 
required  to  obtain  one  name,  and  many  individuals  required 
visiting  several  times.  Such  work  must  be  expected  by  the 
promoters  of  all  cooperative  societies. 

In  beginning  the  canvass  some  time  was  lost  in  seeking 
to  enlist  the  local  buyers.  It  was  the  desire  of  the  promoters 
to  unite  all  interests  and  make  an  organization  sufficiently 
powerful  to  control  the  dried-fruit  business  of  the  valley, 
and,  as  already  stated,  four  or  live  directors  were  buyers 
but  it  was  found  impossible  to  enlist  the  buyers   as  a  class. 


480  CALIFORNIA    FRUIT   SOCIETIES. 

Some  were  financially  dependent  on  commission  houses,  and 
all  thought  they  saw  that  any  organization  which  should 
thoroughly  educate  the  growers,  and  furnish  them  an  inde- 
pendent outlet  for  their  product,  would  not  be  to  their  interest, 
and  but  two  or  three,  except  those  already  in  the  board,  would 
subscribe  stock,  and  of  these  none  ever  sold  their  pack  through 
the  Exchange;  nor,  in  fact,  did  the  buyers  who  were  on  the 
board  of  directors.  It  became  evident  that  a  cooperative 
society  of  producers  must  depend  upon  producers  for  mem- 
bership and  support.  A.s  the  permanent  management  of  the 
Exchange  would  be  attended  with  considerable  expense,  and 
as  its  means  of  living  could  only  come  from  commissions  on 
sales,  it  was  essential  that  a  large  business  should  be  reason- 
ably assured  before  going  on,  and  when  it  became  evident 
that  the  support  of  the  local  buyers  would  be  wanting,  the 
management  of  the  Exchange,  in  self-defense,  promoted  the 
organization  of  three  more  drying  associations,  whose  fruit 
was  expected  to  be  sold  through  the  Exchange,  and  thus 
assist  in  its  support— the  Exchange  taking  the  place  of  the 
commission  houses  which  had  been  accustomed  to  handle  the 
product.  The  manager  of  the  Exchange  spent  considerable 
of  his  paid  time  in  this  work,  and  the  president  and  some  of 
the  directors  much  volunteer  time.  The  total  result  of  the 
cooperative  movement,  up  to  May,  1893,  was  the  establishment 
of  the  Exchange  and  five  cooperative  drying  associations,  with 
an  aggregate  paid-up  capital  at  that  time  of  about  $75,000, 
since  considerably  increased.  The  Exchange  purchased  five 
acres  of  land  in  the  outskirts  of  San  Jose,  and  erected  and 
equipped  a  substantial  warehouse,  and  the  drying  associations 
supplied  themselves  with  the  plant  and  ground  required  for 
their  work. 

In  May,  1893,  the  Exchange  was  ready  for  business,  but 
before  starting,  an  effort  was  made  to  secure  such  pledges  of 
business  as  would  assure  an  adequate  support,  from  commis- 
sions, to  the  Exchange.  It  was  found,  however,  that  abso- 
lutely no  pledges,  except  that  of  the  manager,  could  be 
secured.  The  original  society,  whose  success  gave  the  impetus 
to  the  movement,  declined   to   risk   whal  n 


DRIED   FRUIT   AND   NUT  ASSOCIATIONS.  481 

gained,  in  any  new  enterprise ;  one  of  the  newly-formed  dry- 
ing associations  also  prepared  to  work  alone.  The  other  three 
associations  in  the  end  sold  their  fruit  through  the  Exchange, 
although  they  did  not  agree  to  for  some  time;  and,  in  fact,  the 
effort  to  secure  pledges  in  advance  had  to  be  given  up,  and 
the  stock  was  called  in,  and  the  buildings  erected  and  equipped 
without  the  certainty  of  a  dollar's  worth  of  business  to  come 
to  them;  in  the  end,  however,  business  did  finally  come, 
aggregating  sales,  for  the  year,  approaching  a  half  a  million 
of  dollars,  the  commission  upon  which  fully  paid  all  expenses 
of  the  Exchange,  including  six  per  cent  interest  on  paid-up 
stock,  and,  except  fur  a  loss  by  a  bad  debt,  would  have  per- 
mitted a  small  rebate.  There  were  sold  by  the  drying  asso- 
ciations outside  the  Exchange  about  $200,000  additional.  The 
business  was  conducted  to  the  general  satisfaction  of  the 
growers,  although  the  net  results  to  growers  selling  through 
the  Exchange  were  no  better  than  those  obtained  through 
buyers  and  commission  men,  the  information  as  to  markets 
obtained  by  the  Exchange  being  freely  given  out  for  the 
benefit  of  the  public,  thus  practically  controlling  the  price  of 
dried  fruit  in  the  valley.  It  was,  however,  universally  con- 
ceded that  the  existence  of  the  Exchange  and  the  drying 
associations  was  of  great  value  to  the  fruit-growers  of  the 
district. 

The  experience  of  1893  disclosed  two  points  of  special 
importance,  the  one  decidedly  favorable  to  cooperation,  the 
other  perhaps  debatable.  The  first  related  to  financial  man- 
agement. The  year  1893  w^as  a  year  of  commercial  panic. 
The  banks  of  San  Jose,  although  solvent  and  prosperous,  were 
in  such  danger  of  a  "run  "  that  they  could  not  and  did  not  lend 
a  dollar  to  the  Exchange.  One  stockholder  lent  the  Exchange 
§1,000,  which  was  advanced  to  those  in  need  of  money,  and 
with  that  exception  the  entire  pack  of  the  season  was  moved 
without  borrowing  a  dollar.  Of  course  there  was  some  hard- 
ship; some  growers  desired  money  who  could  not  get  it  until 
their  fruit  was  sold,  but  they  got  along  somehow.  In  a  short 
time,  as  sales  w^ere  made,  money  accumuhited  which  was  not 
called  for  by  the  well-to-do  orchardists,  and  this  money  was 
31 


482  CALIFORNIA    FKUIT    SOCIETIES. 

advanced  to  those  requiring  it,  without  charge  for  interest,  as 
none  was  paid.  In  other  words,  the  Exchange  did  a  free  bank- 
ing business,  to  the  great  advantage  of  its  poorer  stockholders, 
and  to  the  injury  of  none.  The  other  point  had  reference  to 
the  free  information  regarding  markets,  which  was  made  pub- 
lic by  weekly  bulletins  and  through  the  press,  and  benefited 
members  and  non-members  alike.  The  organization  of  the 
bulletin  system  required  a  good  deal  of  time,  which,  in  con- 
nection with  the  cost  of  publication  and  mailing,  cost  about 
one-fifth  of  one  per  cent  of  the  total  output  handled.  This 
expense  was  charged  against  the  fruit  handled,  so  that  the 
owners  of  that  fruit  paid  for  the  information  given,  not  only 
to  stockholders  who  sold  outside  the  Exchange,  but  to  the 
general  public.  The  owners  of  the  fruit  did  not  like  this,  but, 
on  the  other  hand,  could  not  help  themselves,  since  it  was 
believed  that,  if  the  information  was  withheld,  ill-informed 
growers  would  sell  at  less  than  market  rates,  and  thus  prevent 
the  sale  of  Exchange  fruit  except  at  similar  rates,  and  all  to 
the  advantage  of  speculators,  since  the  real  eastern  market 
price  was  fixed  by  law  of  demand  and  supply.  It  was  a  per- 
plexing question,  as  the  real  cooperators  disliked  intensely  to 
have  their  money  used  for  the  benefit  of  those  who  would  not 
cooperate,  and  there  was  doubtless  a  tendency  on  the  part  of 
many  to  reserve  to  themselves  what  they  thought  the  advan- 
tageous freedom  of  an  outsider,  and  let  those  who  would  foot 
this  particular  bill,  since  all  got  tlie  benefit  alike. 

The  business  of  the  Exchange  for  1803  was  closed  with 
great  satisfaction  to  all  concerned,  and  in  1894  there  was  a 
general  tendency  to  sell  through  the  Exchange  or  the  drying 
associations.  On  the  part  of  the  latter,  however,  there  was 
increasing  disposition  to  manage  their  own  affairs  without 
reference  to  the  Exchange.  None  of  the  associations  this  year 
put  their  fruit  unreservedly  in  the  hands  of  the  Exchange, 
which  was  therefore  left  to  such  income  as  could  be  made  from 
commissions  on  fruit  intrusted  to  it  by  individual  stockholders. 
These,  however,  supplied  fruit  in  abundance,  far  exceeding  tlie 
storage  capacity  of  the  Excliange  warehouse.  Money  was  easy, 
the  credit  of  the  Exchange  was  high,  and  there  was  no  difficulty 


DRIED    FiaiT    AND    XUT    ASSOCIATIONS.  483 

in  obtaining  funds  for  all  necessary  advances.  Unfortunately, 
the  general  tendency  of  the  market  was  downward,  the  pur- 
chasing power  of  eastern  buyers  proving  very  small.  This 
tendency  the  Exchange  and  the  drying  associations  undertook 
to  withstand  b}^  publicly  setting  the  prices  above  the  market, 
and  refusing  to  sell  for  less.  The  drying  associations  and 
the  Exchange  worked  together  in  this  matter,  their  presidents 
meeting  weekly  and  agreeing  upon  uniform  prices,  usually 
above  the  market.  Their  lead  was  generally  followed  by 
other  cooperative  societies,  organized  in  other  parts  of  the 
state,  nearly  all  of  whom  held  their  goods  mostly  on  borrowed 
money,  while  outsiders  sold  out;  and  still  the  market  went 
down.  In  the  end,  while  the  Santa  Clara  societies  made  many 
sales  at  better  rates  than  were  generally  obtained,  and  while 
their  action,  with  that  of  the  other  cooperative  societies,  had 
great  effect  in  steadying  the  market  and  preventing  utter 
demoralization,  they  had  to  give  in,  after  paying  consider- 
able interest,  and  sell,  in  the  spring  market,  for  no  more 
and  perhaps  less  than  outsiders  realized  in  the  fall.  This 
result  brought  out  the  great  weakness  of  cooperation;  the 
growers  who  could  not  say  too  much  for  the  Exchange  in  a 
year  when  all  went  well,  and  who  were  perhaps  strongest  in 
urging  the  Exchange  to  hold  firm  at  the  beginning  of  the 
season,  were  prompt  to  condemn  the  action  of  their  agents 
when  it  appeared  that  they  had  been  mistaken  in  judgment; 
and  a  general  desertion  followed.  The  following  year  the 
business  of  the  Exchange  and  the  Unions  was  small,  but  since 
that  time  they  have  rapidly  regained  the  confidence  of  the 
people,  and  in  the  season  of  1898-99  the  number  of  persons 
selling  fruit  through  the  Exchange  was  reported  as  slightly 
greater  than  the  total  number  of  stockholders,  which  may  be 
an  error,  as  the  Exchange  will  not  ordinarily  handle  fruit 
not  the  property  of  its  members.  While  the  object,  at  the 
beginning  of  the  movement  in  the  Santa  Clara  Valley,  was  to 
obtain  entire  control  of  the  product  of  that  section,  no  serious 
effort  has  ever  been  made  to  accomplish  that  end.  The 
Exchange  and  Unions  are  the  largest  and  most  influential 
factors  in  the  trade.    The  Exchange  brand  is  the  acknowledged 


484  CALIFOEXIA   FRUIT   SOCIETIES. 

standard  of  excellence  in  dried  fruit.  They  have  a  substantial 
and  well-managed  business,  and  make  no  attempts  to  increase 
their  own  membership,  or  even  to  hold  the  business  of  their 
stockholders,  much  less  to  promote  the  formation  of  additional 
cooperative  societies. 

I  have  stated  that  the  Exchange  was  organized  to  be  a 
common  selling  agent  for  all  the  Unions,  and  that,  after  its 
organization,  local  influences  of  various  kinds  prevented  the 
Unions  from  accepting  leadership  of  any  kind.  Precisely  like 
individuals,  they  desired  absolute  independence,  and  a  spirit 
of  rivalry  and  distrust  began  to  grow  up  among  them,  such 
as  always  grows  up  between  competitors  everywhere.  To  put 
a  stop  to  this  feeling  and  its  attendant  evils,  negotiations,  begun 
in  1894,  resulted  in  the  establishment,  in  1895,  of  a  common 
agency,  known  as  the  "California  Fruit  Agency,"  through 
which  the  Exchange  and  three  of  the  Unions  have  since  that 
time  made  their  sales.  This  has  obvious  advantages  in 
economy  and  in  other  ways,  but  two  of  the  Unions  have  thus 
far  declined  to  come  in,  and  these  continue  to  make  sale  of 
their  products  through  San  Francisco  commission  houses. 

During  1894  and  1895,  and  later,  quite  a  number  of  dried- 
fruit  associations  similar  to  those  of  the  Santa  Clara  Valley 
were  organized  in  other  fruit  districts  of  the  state,  most  of 
which  died  after  a  more  or  less  feeble  existence.  Of  those 
established  during  that  period,  three  only,  I  think,  survive. 
No  one  of  these  has  any  such  volume  of  business  as  would 
Justify  it  in  making  any  effective  canvass  of  distant  markets 
— an  experience  which  is  essential  to  a  mastery  of  the  art  of 
marketing.  They  have  not  thought  best  to  unite  with  the 
Santa  Clara  Exchanges,  and,  while  they  are  useful,  and  ap- 
parently to  be  permanent  local  societies,  they  have  as  yet 
none  of  them  approached  the  limit  of  success  in  cooperative 
marketing. 

The  principal  fruit  industry  of  the  seven  southern  counties 
of  California  is  the  citrus  fruits — oranges,  lemons,  and  pomelos. 
For  a  long  lime  it  was  not  thought  that  that  these  counties 
were  adapted  to  the  production  of  deciduous  fruits,  except 
apricots,  and,  at  any  rate,  the   citrus  industries  had   greater 


DRIED    FRUIT    AND    NUT   ASSOC'IATIOXS.  485 

attraction  for  the  people.  Gradually,  however,  the  area 
devoted  to  deciduous  fruits  increased,  and  the  product  was 
marketed  dried.  The  growers  were  new  to  the  business,  and 
knew  little  about  either  the  cultivation  or  the  curing  of  the 
fruit,  and  the  result  was  a  generally  inferior  product,  which 
did  not  bring  the  price  of  the  northern  dried  fruit,  or  any 
satisfactory  returns  to  the  producers.  The  farmers  of  the 
southern  counties  of  California,  liowever,  are  perhaps  the  most 
intelligent  and  enterprising  rural  population  in  the  world,  and 
were  not  likely  to,  and  did  not  long  rest  contented  with  such 
a  state  of  affairs.  The  deciduous-fruit  interests  began  to  draw 
out  from  the  shadow  of  the  great  citrus  industry,  to  meet 
and  organize  for  mutual  advantage,  and  to  talk  of  cooperation, 
whose  possibilities  were  well  shown  by  the  success  of  the 
citrus  associations,  to  be  described  in  a  later  chapter.  At 
length,  after  a  number  of  conferences,  in  October,  1897,  the 
Los  Angeles  Chamber  of  Commerce  called  a  mass  convention 
of  those  interested  in  the  deciduous-fruit  industry  to  consider 
the  subject  of  cooperative  marketing.  After  a  day  spent  in 
discussion,  a  committee  was  appointed  to  prepare  a  plan  of 
organization,  which  was  duly  reported  to  an  adjourned  meeting 
of  the  convention  a  month  later,  and  vigorously  discussed  for 
anotlier  full  day.  At  the  close  of  the  discussion  it  was  resolved 
to  form  the  "Southern  California  Deciduous  Fruit  Exchanges," 
which  was  to  consist  of  an  incorporated  society  with  that  name, 
whose  members  should  be  local  "Exchanges"  or  "associations  " 
for  collecting  and  curing  the  fruit,  like  the  "Unions"  of  the 
Santa  Clara  Valley.  None  of  these  local  societies  were  in 
existence,  and  they,  of  course,  must  be  created  before  they 
could  join  in  the  creation  of  the  central  society.  This 
involved  months  of  hard  canvassing,  and  traveling  by  rail 
and  private  conveyance  over  a  district  comprising  many 
thousand  square  miles.  Evidently  this  would  cost  money, 
and,  after  unanimously  requesting  the  most  earnest  of  the 
promoters  to  undertake  the  great  labor  of  organization,  those 
present  assessed  themselves  one  dollar  each  to  pay  the  expenses ! 
There  were  thirty-seven  of  them  who  paid,  and  there  were 
thirty-seven  dollars — perhaps  enough  to  pay  the  postage  bills, 


486  CALIFORNIA    FRUIT    SOCIETIES. 

but  certainly  not  sufficient  to  buy  stationery.  Another  effort 
was  made,  which  brought  the  total  up  to  $139,  au  amount 
perhaps  sufficient  to  pay  the  postage,  printing,  and  stationery 
bills,  but  leaving  nothing  for  traveling  expenses,  much  less 
compensation  for  the  gentleman  whom  they  had  asked  to 
conduct  the  organization,  and  who  was  one  of  their  own 
number,  and,  presumably,  no  better  off  than  the  rest.  That 
sum,  however, .was  perhaps  the  fair  share  of  the  few  dele- 
gates present,  and  the  convention  appointed  a  "finance  com- 
mittee" to  procure  the  rest  of  the  money,  and  went  home. 
The  finance  committee  could  raise  no  money,  and  then  the 
energetic  organizer  went  to  work  and  organized  eleven  local 
societies,  which,  with  a  few  large  individual  growers,  met  and 
organized  the  Central  Exchange,  which  began  business  on 
June  23,  1898,  and  sold,  during  the  year,  for  its  members, 
dried  fruit  to  the  amount  of  |63,721,  the  small  sale  being  due 
to  a  drought  so  severe  as  to  practically  destroy  the  crop,  some  of 
the  local  associations  not  having  a  pound  of  fruit  to  dispose  of 
I  mention  the  monetary  details  of  these  organizations  for  the 
reason  that  they  are  seldom  publicly  spoken  of,  the  farmers 
aj)pearing  to  think  that  the  funds  for  such  work  are  supplied 
as  the  Israelites  were  supplied  with  manna,  which  is  distinctly 
not  tlie  fact.  If  the  Lord  provides  for  such  expenses,  He  does 
it  by  inspiring  with  an  altruistic  spirit  some  capable  man, 
who  goes  down  into  his  pockets  and  digs  up  tlie  money. 
Whether  the  organizer  of  these  southern  deciduous  Exchanges 
was  ever  reimbursed  for  his  expenses,  I  do  not  know.  I 
presume  he  was.  But  if  he  had  not  succeeded  he  would  not 
have  been,  which  would  have  been  wrong.  Those  engaged 
in  an  industry  have  no  moral  right  to  ask  one  of  their  number 
to  assume  such  a  work  without  sharing  the  risk.  Altruism 
is  properly  displayed  in  behalf  of  really  suffering  Immanity, 
but  farmers  with  homes,  and  horses,  and  credit,  and  enough 
to  eat,  ought  not  to  ask  charity  of  this  kind.  It  must  not  be 
thought  that  these  farmers  of  southern  California  are  worse 
than  others.  On  the  contrary,  that  convention  did  more 
towards  raising  money  than  any  other  I  ever  knew  of,  except 
one,  for  which  reason  I  select  it  for  my  principal  illustration, 


DRIED    FRUIT    AND    NUT    ASSOCIATIONS.  487 

and  also  because,  while  I  had  no  connection  with  the  move- 
ment, I  happen  to  be  familiar  with  the  facts.  Cooperation 
in  marketing  implies  cooperation  of  persons  of  some  means, 
and  should  be  begun  and  prosecuted  on  business  principles. 
The  work  of  these  southern  societies  has  been  satisfactory 
to  the  membership,  and  their  number  and  membership  are 
increasing. 

As  these  pages  are  being  printed,  there  is  in  progress  a 
more  ambitious  cooperative  effort  than  I  have  known  of  else- 
where, in  connection  with  marketing.  This  is  nothing  less 
than  the  organization  of  a  "  Pacific  Prune-growers'  Associa- 
tion," whose  object  is  to  combine  under  one  head  all  the  dried- 
fruit  societies  which  I  have  mentioned,  together  with  all  other 
similar  societies  and  all  individuals  engaged  in  the  production 
of  prunes  in  the  Pacific  Coast  states.  The  organization,  as  pro- 
posed, will  be  almost  precisely  on  the  lines  of  the  reorganized 
Raisin  Association,  already  described,  and  including  similar 
agreements  with  the  private  packers  and  commission  mer- 
chants, who  are  understood  to  be  generally  favorable  to  it,  and 
without  whose  cooperation  it  could  not,  at  present,  succeed. 
Whether  it  can  yet  succeed  with  their  aid  is  quite  doubtful, 
as  the  prune-growers  are  widely  scattered  over  a  large  area 
comprising  several  states,  and  it  will  be  contrary  to  all  expe- 
rience if  they  can  be  induced  to  sign  the  necessary  contracts 
without  a  long  and  very  expensive  canvass,  if  at  all.  So  far 
as  California  alone  is  concerned,  whose  people  are  coming  to 
be  fairly  well  educated  in  cooperation,  this  proposal  is  not 
visionary,  although  it  may  not  succeed.  But  the  essential 
feature  of  the  growers'  contracts  is  the  sale  of  an  undivided 
twentieth  (five  per  cent)  interest  in  each  man's  crop,  in  con- 
sideration of  services  to  be  performed,  with  absolute  control, 
as  a  partner,  of  the  whole  crop  as  soon  as  harvested.  It  will 
be  very  strange  if  the  fruit-growers  of  Oregon,  Washington, 
and  Idaho  shall  be  found  willing,  without  previous  instruc- 
tion or  experience  in  cooperation,  to  at  once  proceed  to  the 
exercise  of  this  highest  development  of  the  art. 

Among  the  earliest  and  most  effective  of  the  cooperative 
marketing  societies  was  that  of  the  walnut  growers.     This  is 


488  CALIFORNIA    FRUIT   SOCIETIES. 

due  to  the  fact  that  tlie  Persian  wahiut,  while  it  grows  luxuri- 
autly  in  most  parts  of  California,  has  thus  far  been  found 
commercially  profitable  only  in  limited  areas  in  a  few  of  the 
southern  coast  counties,  with  the  result  that  the  number  of 
growers  is  small,  and  the  work  of  organization  comparatively 
easy.  Organization,  however,  did  not  come  at  once.  In  1887 
about  twenty  walnut-growers  of  Los  Angeles  County  organized 
the  Los  Nietos  and  Ranchita  Walnut-growers'  Association, 
This,  for  a  long  time,  was  the  only  walnut-growers'  society,  but 
with  the  increase  of  the  product,  and  increasing  competition 
with  each  other,  other  associations  w^ere  gradually  formed, 
until  they  now  number  seven,  and  include  nearly  all  the 
growers.  They  have,  as  yet,  formed  no  central  organization 
except  an  informal  one  of  representatives  of  each  society, 
which  meets  as  occasion  requires,  to  fix  the  prices  of  the  crops 
to  which  each  association  adheres.  The  associations  control 
the  output  of  California  walnuts,  and  fix  prices,  subject  to  the 
competition  of  the  French  crop.  The  sales  of  this  society,  in 
1898,  were  over  $400,000.  The  original  society  now  numbers 
two  hundred  twenty  growers,  and,  in  1898,  shipped  over 
two  hundred  car-loads  of  walnuts. 


CHAPTER    VI. 

THE    CALIFORNIA    FRUIT    EXCHANGE. 

IN  the  autumn  of  1893,  while  the  Santa  Clara  County 
Fruit  Exchange  was  in  the  full  tide  of  its  activity,  the  Cali- 
fornia State  Horticultural  Society  held  a  special  session  at 
San  Jose  for  the  purpose  of  studying  its  operations.  In  the 
enthusiasm  of  the  moment  it  was  voted  to  establish  a  state 
Exchange,  whose  function  should  be  to  unite  all  branches  of 
the  fruit  industry  throughout  the  state  for  common  action  for 
common  purposes.  Just  what  purposes  would  prove  to  be 
common  were  probably  not  then  well  defined  in  the  mind  of 
-any  one,  but  that  would  work  itself  out.  A  committee  was 
appointed  on  the  spot,  instructed  to  choose  directors  from 
their  own  number  who  should  proceed  to  organize  the  growers 
of  the  state  into  one  body,  witli  the  state  Exchange  at  the 
head.  When,  however,  the  directors  were  chosen,  they  con- 
sented to  act  only  temporarily,  until  a  special  state  conven- 
tion of  growers  should  formally  determine  whether  a  state 
Exchange  was  desirable,  and,  if  so,  mark  out  the  general  lines 
upon  which  it  should  proceed,  and  select  directors  to  serve 
for  the  first  year.  In  due  time  the  convention  was  called  and 
met,  with  a  large  representative  attendance  from  niost  fruit- 
growing counties  of  the  state.  The  plans  which  had  been 
formulated  by  the  temporary  organization  were,  after  a  full 
discussion,  unanimously  approved,  permanent  directors  were 
selected  to  incorporate  the  Exchange  and  serve  for  one  year, 
and  the  Exchange  was  formally  recognized  as  the  "author- 
ized agent  of  the  fruit-growers  of  California."  The  plans  had 
a  short  time  before  been  approved  by  a  regular  annual  state 
fruit-growers'  convention,  which  had  met  in  the  meantime, 
and  by  such  local  bodies  of  growers  as  there  had  been  oppor- 
tunity^ to  consult.  The  special  convention  was  unanimous 
and  enthusiastic,  voting  very  heartily  to  begin  subscribing 

(489) 


490  CALIFORNIA    FRUIT   SOCIETIES. 

for  stock  then  and  there,  but  upon  subscriptions  being  called 
for  the  hall  was  nearly  emptied  within  a  few  minutes,  with 
only  some  hundreds  of  dollars  subscribed,  by  less  than  a  dozen 
subscribers,  but  one  of  whom  ever  made  good  his  subscription. 

In  due  time  the  directors  met,  subscribed  to  the  stock, 
organized,  and  incorporated.  The  manager  who  had  acted 
during  the  temporary  organization,  was  the  same  who  had 
served  the  Santa  Clara  Exchange  during  its  period  of  organi- 
zation, and  was  therefore  assumed  to  have  had  a  useful  expe- 
rience. He  undertook  to  serve  only  until  the  enterprise  was 
well  started,  but  remained  in  service  for  over  a  year.  The 
character  and  scope  of  the  work  which  the  Exchange  should 
undertake  had,  in  general  terms,  been  outlined  by  the  conven- 
tion, from  which,  of  course,  directors  chosen  by  that  conven- 
tion would  not  feel  at  liberty  to  materially  depart  for  the  first 
year.  The  outlined  program,  however,  contained  far  more, 
than  could  be  undertaken  at  once,  and  the  obvious  first  duty 
was  to  establish  an  effective  organization,  with  the  necessary 
capital  and  income,  and  to  this  effort  the  manager  addressed 
himself. 

The  press  of  the  state  lent  itself  very  cordially  to  the 
movement,  but  was  of  course  unable  by  its  own  utterances  to 
treat  the  subject  in  any  such  way  as  to  really  contribute 
to  the  education  of  the  people,  upon  which  everything 
depended.  The  majority  of  the  growers,  and  at  first  the 
majority  of  the  directors,  regarded  the  state  Exchange  as  a 
proposed  selling  agent  for  tlie  fruit  of  the  whole  state,  some- 
what on  the  plan  of  the  California  Fruit  Union,  then  just 
going  out  of  business  ;  and,  in  fact,  most  people  considered  it 
as  connected  exclusively  with  dried  fruits.  Those  connected 
with  the  press,  as  well  as  most  growers,  having  little  or  no  idea 
either  of  the  real  bonds  of  connection  between  the  different 
branches  of  the  industry,  or  of  the  limitations  of  possible 
state  cooperation  imposed  by  matters  of  finance  and  detail, 
were  unable  to  discuss  the  subject  intelligently,  and  the 
manager  was  compelled  to  expend  a  great  part  of  his  vital 
force  in  combating  erroneous  impressions,  and  warning  against 
extravagant  anticipations.     With  so  large  an  undertaking  as 


THE   CALIFORNIA    FRUIT    EXCHANGE.  491 

the  welding  of  twenty  thousand  fruit-growers  distributed 
unevenly  over  a  territory  two  hundred  miles  wide,  and  of  a 
'length  extending  from  the  latitude  of  Connecticut  to  the 
latitude  of  Georgia,  into  a  compact  mass,  knowing  the  same 
facts,  and  consequently  thinking  the  same  way,  the  obvious 
course  was  to  enter  upon  a  year's  campaign  of  education, 
attempting  no  positive  action  until  all  were  prepared  to  act 
together.  The  conditions  for  this  were  in  many  respects 
favorable;  the  columns  of  the  entire  press  of  the  state  were 
open  to  the  Exchange,  the  transportation  companies  were  glad 
to  contribute  to  the  movement  by  the  free  carriage  of  those 
engaged  in  promoting  it,  the  manager's  experience  and 
abilities  were  well  adapted  to  that  work,  but  the  effort  failed 
for  the  lack  of  the  few  thousand  dollars  necessary  to  pay  the 
expenses  of  the  first  year  or  two.  Its  history,  however,  is  of 
value. 

The  composition  of  the  board  of  directors  illustrates  one 
of  the  greatest  difficulties  of  cooperation  on  a  large  scale. 
Selected  by  a  convention  of  members  mostly  unacquainted 
with  each  other,  the  choice  was  necessarily  somewhat  hap- 
hazard, but  resulted — as  was  almost  certain  to  be  the  case — in 
the  choice  of  excellent  men.  Of  course,  however,  they  were 
entirely  unacquainted  with  each  other,  and  for  the  most  part, 
were  without  experience  in  cooperation  or  positive  views  in 
regard  to  it,  and  were  so  widely  scattered  throughout  the 
state  that  the  cost  of  each  meeting  was  over  $100.  They  were 
very  slow  in  reaching  conclusions  or  in  formulating  a  defi- 
nite policy  or  plans.  They  were  also  unacquainted  with  the 
manager,  and  it  did  not  occur  to  them  to  instruct  him  to  pro- 
ceed at  his  own  discretion,  on  the  lines  upon  which  he  had 
been  working,  and  which  had  been  approved  by  conventions 
of  growers,  until  the  directors  should  have  had  time  to 
become  familiar  with  the  situation,  agree  upon  an  order  of 
proceeding,  and  select  a  permanent  manager.  In  conse- 
quence, an  entire  month  was  lost  in  inaction,  which  in  a 
movement  of  this  kind,  is  quite  sufficient  to  have  it  pass 
from  the  public  mind.  The  impetus  thus  lost  was  never 
recovered,  although  in  due  time  the  directors  did  meet  and 


492  CALIFORNIA   FRUIT   SOCIETIES. 

properly  authorize  the  prosecution  of  the  work.  The  greatest 
trouble  with  cooperative  societies  operating  over  large  areas 
is  likely  to  be  inefficiency,  of  which  one  of  the  chief  causes  is 
the  wide  scattering  of  directors,  growing  out  of  the  insistence 
upon  geographical  distribution.  Cooperators  will  not  consent 
to  intrust  the  direction  to  a  few  capable  men  so  situated  as  to 
be  able  to  meet  often  with  little  or  no  expense,  and  the  cost  of 
frequent  meetings  of  widely-scattered  directors  is  beyond  the 
means  of  a  new  organization. 

In  connection  with  selling  the  stock  of  the  state  Exchange, 
the  manager  devoted  his  time  to  the  promotion  of  local 
organizations  of  growers,  which  should  be  the  foundation 
upon  which  the  Exchange  should  rest.  It  was  evident,  as  the 
experience  of  the  California  Fruit  Union  had  shown,  that  no 
central  organization  could  deal,  with  advantage,  with  the 
thousands  of  individual  growers,  scattered  over  wide  areas  ; 
before  uniting  them  in  any  state  organization,  it  was  essential 
that  local  societies  should  be  formed.  It  was  also  evident  that 
tlie  "natural  method  of  growth  would  be  to  await  the  forma- 
tion of  the  local  societies,  which  should  by  natural  attraction 
come  together  in  a  state  Exchange,  supported  and  controlled 
by  them  as  a  common  head.  But,  on  the  other  hand,  there 
were  very  few  local  societies  in  existence,  and  those  were  not 
formed  on  any  common  plan;  nor  had  they  any  acquaint- 
ance with  each  otlier,  or  any  expressed  disposition  to  unite; 
and  there  was  no  likelihood  that,  except  as  the  result  of  an 
organized  campaign  of  education,  their  number  would  very 
rapidly  increase;  it  was  also  evident  that,  after  their  organiza- 
tion, they  must  pass  through  a  period  of  unprofitable  com- 
petition with  each  other,  before  developing  any  spontaneous 
disposition  to  unite.  This  would  put  off  the  period  of  state 
organization  so  far  into  the  future  as  to  promise  no  relief 
except  at  the  end  of  a  long  and  exhausting  struggle,  involving 
serious  injury  to  the  fruit  industries  of  the  state  and  the 
many  other  interests  dependent  upon  it.  The  example  of  the 
raisin  industry  showed  the  evil  of  delaying  organization  until 
growers  had  no  money  wherewith  to  organize,  and  it  was 
determined  to  make  a  serious  attempt  to  forestall  disaster  by 


riri-:  California  fruit  exchange.  403 

organizing  in  time;  it  was  therefore  determined,  as  the  defi- 
nite policy  of  the  Exchange,  that  it  should  boldly  assume,  for 
the  first  year,  the  position  of  leader,  and  in  that  capacity 
promote  the  formation  of  local  societies  everywhere,  which, 
when  organized,  should,  by  ownership  of  stock,  control  the 
Exchange,  which  should  then  become  their  mouthpiece  and 
servant,,  just  as  it  would  naturally  have  been  had  their 
organization  preceded  its  own. 

In  the  prosecution  of  this  work  the  manager  was  reason- 
ably successful.  Interest  was  everywhere  awakened,  his  pres- 
ence, and  that  of  the  other  officers,  being  earnestly  sought 
from  all  quarters,  to  explain  the  methods  of  operation,  and 
aid  in  perfecting  the  details  of  organization.  There  was  a 
great  difficulty,  however,  in  the  lack  of  organizing  ability  in 
the  various  districts.  One  or  two  individuals  would  invite 
the  manager  to  meet  their  people  at  a  fixed  time,  and  when 
he  arrived,  there  would  be  nobody  to  hear  him,  because  the 
district  had  not  been  properly  canvassed.  In  nearly  every 
case  a  second  and  sometimes  a  third  meeting  had  to  be  called 
before  getting  people  out,  and  the  local  promoters  in  no 
instance  ever  came  to  the  meetings  with  definite  detailed 
plans  and  estimates  of  expenditure,  although  earnest  efforts 
were  always  made  to  induce  them  to  do  so.  The  mass  of  the 
growers  were  distrustful  and  suspicious,  and  would  trust 
nothing  to  the  common  sense  and  honesty  of  their  chosen 
agents.  They  insisted  on  hearing  and  discussing  the  minute 
details  of  the  projected  business,  which  consumed  time  and 
tended  to  lead  to  nothing.  The  meetings,  however,  invariably 
passed  the  resolutions  requested,  and  appointed  committees  to 
proceed  to  organization.  If  left  to  themselves,  however,  the 
committees  ordinarily  did  nothing,  it  being  usually  necessary 
for  the  manager  of  the  state  Exchange  to  stay  and  assist,  for  a 
time  at  least,  in  the  house-to-house  canvass.  This,  however, 
was  not  always  the  case,  and  before  the  close  of  the  season  a 
large  number  of  societies  were  organized. 

But  the  principal  difficulty  was  the  financial  one.  The 
more  substantial  growers  almost  universally  held  themselves 
aloof  from   the   movement;   all   these  were  anxious   to  have 


494  CALIFORNIA    FRUIT    SOCIETIES. 

''the  small  growers"  unite,  for  the  purpose  of  steadying  the 
market,  but  declined  to  compromise  themselves  in  regard  to  it 
in  any  way,  and,  as  a  rule,  to  contribute  to  its  support. 
There  were,  of  course,  exceptions.  The  smaller  growers  very 
generally  sustained  the  movement  with  a  good  deal  of  enthu- 
siasm until  it  reached  the  point  of  footing  the  bills;  there  they 
drew  the  line.  When  local  associations  were  started,  the 
growers  at  once  became  absorbed  in  providing  for  their  own 
local  interests,  and  would  do  nothing  for  the  state  Exchange.* 
The  manager  w^as  necessarily  compelled  to  originate  and  lay 
out  the  work,  covering  all  parts  of  the  state,  attend  to  the 
correspondence,  address  meetings,  write  for  the  press,  prepare 
a  weekly  bulletin  of  information,  aid  in  the  formation  of  local 
associations,  and  canvass  for  stock  with  which  to  pay  the  bills. 
With  his  experience  in  obtaining  funds  for  the  Santa  Clara 
Exchange,  he  was  of  the  opinion,  and  so  advised  the  directors, 
that,  with  the  whole  state  to  draw  from,  he  could  readily 
secure  the  small  sum  needed  for  expenses,  by  the  sale  of  stock 
upon  which  twenty-five  per  cent  of  the  par  value  was  paid  in, 
and  on  the  strength  of  his  statement  the  directors  borrowed  a 
few  hundred  dollars  with  which  to  start  work.  The  manager 
found  himself  wholly  mistaken.  In  the  Santa  Clara  case 
one  hundred  twenty-nine  days  of  paid  service  secured  four 
hundred  stock  subscriptions,  averaging  about  $45  each,  or  a 
little  over  three  subscribers  per  day,  and  $135.  To  produce 
those  four  hundred  subscriptions,  however,  in  addition  to  the 
paid  service,  there  was  a  very  much  greater  amount  of  volun- 
teer service,  by  directors  and  others;  relying  upon  a  similar 
amount  of  volunteer  assistance,  and  upon  the  expressed 
interest  of  the  members  of  the  special  convention  which 
created  the  Exchange,  and  of  many  other  prominent  growers, 
the  manager  said  that  he  could  doubtless,  in  addition  to  his 


*In  consequence  of  this  failure  of  local  organizations  to  recognize  that  they 
needed  leadership,  and  a  bond  to  unite  them  with  each  other,  and,  in  any 
event  their  unwillingness  to  pay  for  it,  or  even  to  return  what  had  been 
expended  for  them,  nearly  all  the  associations  thus  formed  soon  died,  and  none 
ever  became  influential.  The  growth  had  been  forced,  and  they  could  not  live 
without  careful  cultivation. 


THE    CALIFORNIA    FKdT    PLXCIIAXGE.  405 

other  work,  sell  stock  to  the  amount  of,  at  least,  $1,200  or 
$1,500  per  month,  twenty-five  per  cent  paid  in,  which  would 
pay  the  current  expenses,  leaving  the  balance  as  a  gradually 
increasing  fund  to  be  called  in  later,  if  needed  as  working 
capital.  The  manager  said  that  he  expected  much  more,  but 
so  much  he  felt  sure  of,  and  the  directors  relied  on  his  judg- 
ment. Never  was  a  man  more  mistaken.  The  Santa  Clara 
A'alley  is  a  thickly  populated  and  homogeneous  community, 
and  while,  as  stated  in  describing  the  Santa  Clara  Exchange, 
it  was  hard  to  raise  money  there,  towards  the  close  of  the 
canvass,  the  persistent  work  of  six  months  in  one  neighbor- 
hood began  to  tell.  All  growers  came  to  know  about  the 
county  Exchange,  and  to  take  interest  in  it,  as  a  thing  really 
likely  to  materialize  in  brick  and  mortar  before  their  eyes, 
and  to  talk  of  it  with  their  neighbors,  as  something  real  and 
not  a  dream,  so  that,  towards  the  last,  less  time  was  occupied 
in  converting  individuals.  In  securing  funds,  however,  for 
the  state  Exchange,  but  little  time  could  be  devoted  to  any 
neighborhood;  and  in  spite  of  the  wide  publicity  supposed  to 
have  been  given  to  the  plans,  it  was  always  a  new  thing,  to  be 
fully  explained  from  the  ver}^  beginning  to  each  individual, 
usually  requiring  interviews  of  several  hours,  nearly  killing 
both  parties  thereto ;  and  when  it  came  to  reducing  the  infi- 
nite weariness  of  so  much  talk  to  the  concrete  financial  result 
of  a  stock  subscription,  with  an  immediate  casli  payment 
thereon,  it  was  like  drawing  a  tight  cork  from  a  wine  bottle. 
It  was  usually  the  case  that  the  strongest  talkers  for  cooperation 
were  the  hardest  to  get  money  from.  Besides,  the  money  in 
the  Santa  Clara  case  was  at  least  to  go  into  tangible  property, 
which  the  stockholders  could  use,  while  that  sought  for  the 
state  Exchange  was  avowedly  to  be  used  in  experiment,  and 
might  be  lost.  The  manager,  in  his  estimates,  had  allowed 
for  the  different  circumstances,  and  assigned  twenty-five  per 
cent  of  the  proposed  capital  stock  for  the  expenses  of  organiz- 
ing, as  against  seven  and  one-half  per  cent  actually  expended 
in  the  Santa  Clara  organization,  but  he  did  not  allow  enough. 
There  were  other  disappointments;  the  "representative  grow- 
ers" of  the  special  convention  whose  supposed  enthusiasm  had 


496  CJALlFOK^■lA    FRUIT   SOCIETIES. 

deluded  eleven  of  their  number  into  accepting  the  respon- 
sibilities of  directors,  were  utter  humbugs,  who  cooperated 
only  with  their  mouths;  of  the  whole  hallful,  but  one,  except 
those  chosen  as  directors,  could  ever  be  dragooned  into  risking 
one  dollar  in  the  enterprise.  The  directors  chosen  were  many 
of  them  very  substantial  men;  they  subscribed  properly  to 
the  support  of  the  movement,  but  did  not  feel  called  upon  to 
pay  its  entire  expense,  and  none  of  them  developed  any 
faculty  of  inducing  others  to  come  in  with  money.  The 
president,  in  the  end,  did  something,  but  for  a  long  time  he 
contented  himself  with  explaining  the  plans  of  the  Exchange 
and  receiving  the  warmest  endorsement  of  their  utility,  he 
assuming,  of  course,  that  well-to-do  growers  who  so  strongly 
favored  cooperation,  would  of  themselves  send  in  their  sub- 
scriptions and  their  checks.  It  took  him  a  year  to  learn  how 
contemptible  well-to-do  people  could  be  in  money  matters,  and 
that  the  promoters  of  important  cooperative  enterprises  must 
either  pay  the  bills  themselves  or  wrest  the  money  almost  by 
force  from  reluctant  victims.  The  smaller  growers  were  far 
the  easiest  to  get  money  from,  but  of  course  they  subscribed  in 
small  amounts,  and  upon  experiment  it  was  found  that  the 
expenses  of  reaching  and  canvassing  them  exceeded  the  cash 
payment  of  twenty-five  per  cent  upon  their  stock,  and  that  no 
one  less  fully  informed  than  the  manager,  or  less  determined, 
could  get  anything.  In  the  formation  of  local  societies  the 
request  was  constant  that  they  should  not,  while  they  were 
themselves  organizing,  be  asked  to  aid  the  state  movement,  as 
they  needed  all  their  strength  at  home.  If  it  were  called  to 
their  attention  that  they  would  not  have  organized  if  some 
one  else  had  not  paid  the  expense  of  agitating  the  matter 
among  them,  and  showing  them  how,  and  that  they  should 
assume  their  share  of  the  general  work  from  which  they  had 
specially  benefited,  they,  of  course,  could  not  answer,  but  they 
would  not  pay.  In  short,  the  entire  year's  work  of  the  direc- 
tors and  officers  of  the  Exchange  was  one  constant  struggle  to 
raise  the  money  to  pay  the  very  modest  current  bills.  In  no 
month,  for  the  entire  year,  did  the  cash  income  equal  the 
current  expense,  although  tiic  par  value  of  the  stock  subscrip- 


THE    CALIFORNIA    FRUIT    EXCHANGE.  497 

tions  was,  of  course,  more  than  the  current  expenses.  The 
directors  and  manager  agreed,  liowever,  that  unless  twenty- 
five  per  cent  of  tlie  stock  subscribed  would  pay  for  organizing, 
it  would  not  be  best  to  proceed.  They,  themselves,  paid  up 
their  stock  in  full. 

It  may  occur  to  some  that  these  details  are  unnecessary. 
I  am  giving  them  fully  as  affording  the  only  means  of  an 
accurate  study  of  cooperation.  I  am  reasonably  familiar  with 
the  literature  of  cooperation,  but  what  has  fallen  in  my  way 
appears  to  have  been  largely  the  work  of  enthusiasts,  or  of 
mere  observers.  I  have  thought  it  useful  to  give  accurately 
and  in  detail  the  results  of  personal  experience  in  cooperative 
work,  in  order  to  make  clear  where  the  main  difficulty  lies  in 
the  promotion  of  cooperative  work  among  farmers.  They 
will  not  pay  the  expense  of  organizing,  which,  when  on  an 
important  scale,  is  too  large  for  a  few  altruistic  individuals  to 
assume. 

The  expectation  had  been  that  the  manager,  in  a  few 
months  of  preliminary  work,  would  secure  funds  sufficient  to 
employ  the  staff  required  to  make  a  beginning  of  the  actual 
work  which  the  Exchange  was  created  to  perform.  As  already 
stated,  experience  showed  that  he  could  hardly  secure  enough 
to  pay  current  expenses,  and,  although  some  pains  were  taken 
to  let  it  be  known  that  a  permanent  manager  would  soon  be 
wanted,  and  that  a  desirable  position  would  soon  be  open  to 
any  one  who  should  develop  a  combined  talent  for  organ- 
ization and  business,  no  one  appeared,  except  the  temporary 
manager,  who  could  make  any  headway.  Obviously  it  was 
absurd  to  continue  an  organization  whose  entire  energy  was 
consumed  in  providing  for  its  own  existence,  and  it  was  deter- 
mined, after  a  few  months,  to  attempt  the  fulfilment  of  at  least 
one  of  its  duties.  All  growers,  from  the  beginning  of  the 
season,  had  been  anxious  for  correct  information  in  regard  to 
crop  prospects,  foreign  and  domestic,  existing  stocks  of  fruit, 
and  the  hundred  items  which  go  to  determine  the  market 
prices  of  agricultural  products.  Vague  or  incorrect  informa- 
tion on  these  points  was  worse  than  useless,  and  information 
safe  to  do  business  upon  costs  money.  No  local  newspaper 
32 


498  CALIFORNIA    FRUIT    SOCIETIES. 

could  afford  the  necessary  expenditure,  and  what  the  trade 
learned  at  their  own  expense  they  naturally  wished  to  use  for 
their  own  purposes;  all  current  information  was  believed  by 
growers  to  be  colored  in  the  trade  interests,  and  they  placed 
little  reliance  upon  it.  There  was  no  doubt  that  there  was  a 
really  earnest  desire  on  the  part  of  growers  for  information 
compiled  by  their  own  agents.  It  was  estimated  that  this 
could  be  supplied  them,  not  thoroughly,  at  first,  but  reason- 
ably well,  and  better  than  had  before  been  available,  for  about 
$5,000  per  year,  and  it  was  not  doubted  that  more  than  five 
thousand  growers  would  gladly  pay  $1.00  per  year  for  that 
information.  This  belief  was  greatly  strengthened  by  the 
great  demand  for  a  weekly  bulletin,  published  for  a  portion 
of  the  previous  year,  by  the  Santa  Clara  County  Exchange, 
for  the  benefit  of  its  stockholders,  and  regularly  given  to  the 
press.  It  was  therefore  determined  to  begin  actual  work  by 
the  publication  of  such  a  bulletin,  with  the  price  fixed  at  $1.00. 
Sample  numbers  were  widely  distributed  among  growers,  and 
every  effort  was  made  to  obtain  subscriptions,  short  of  putting 
actual  canvassers  in  the  field,  which  the  price  fixed  did  not 
admit,  and  which,  besides,  was  not  in  accord  with  the  coopera- 
tive principle.  The  bulletin,  as  issued,  was  regularly  given 
to  the  press.  After  three  months'  trial,  it  was  found  that  just 
four  hundred  and  eleven  persons — about  one  hundred  of  whom 
were  tradesmen — were  willing  to  pay  $1.00  per  year  for  infor- 
mation; the  remainder  of  the  growers,  although  perfectly 
aware  that  the  existence  of  the  bulletin  depended  entirely 
upon  the  subscriptions  received,  would  pay  nothing,  since  they 
could  get  it  for  nothing  in  the  papers  which  they  received. 
The  bulletin  was  therefore  stopped,  with  a  loss  of  about  $100, 
including  the  sum  necessary  to  reimburse  those  who  had  paid, 
by  supplying  another  journal. 

The  policy  of  the  Exchange,  as  it  existed  in  the  minds  of 
its  promoters,  did  not  contemplate  the  actual  selling  of  fruit. 
Sales  were  to-  be  made  by  the  local  Exchanges,  the  state 
Exchange  serving  as  a  bond  to  unite  them  and  transacting  for 
all  a  large  amount  of  business  essential  to  all  alike.  The 
majority  of  growers,  however,  having  little  conception  of  the 


THE    C'ALII'OKXIA    FKUIT    KXCHANGK.  499 

detail  of  a  large  business,  and  not  realizing  the  impossibility 
of  suddenly  effecting  so  large  a  concentration,  conceived  of  the 
Exchange  mainly  as  a  connnon  selling  agent,  which  should 
eventually  control  the  entire  fruit  product  of  tiie  state,  and 
some  large  growers  outside  the  Exchanges  expressed  strong 
desires  that  the  Exchange  should  sell  fruit.  The  creation  of 
an  effective  system  of  agencies,  however,  through  which  to 
market  a  large  volume  of  any  commodity,  requires  time  and 
money,  which  the  Exchange  did  not  possess;  in  order,  how- 
ever, to  comply  with  an  apparent  demand,  the  directors 
arranged  with  a  very  responsible  concern,  for  whose  fidelity 
they  w^ere  willing  to  stand  responsible,  for  a  more  effective 
selling  service  than  the  growers  had  ever  had  at  their  disposal, 
at  a  rate  so  low  as  to  involve  a  certain  loss  to  the  contracting 
house  except  as  the  result  of  a  very  large  volume  of  business. 
The  result  again  showed  the  unreliability  of  producers  in  the 
matter  of  supporting  their  agents,  and  their  tendency  to 
believe  evil  of  them  rather  than  good.  Not  a  single  grower  of 
those  who  had  demanded  the  service,  or  a  single  association, 
except  one  very  small  one,  voluntarily  placed  a  pound  of  fruit 
at  the  disposal  of  the  Exchange  agency  in  any  such  way  as 
justified  the  expenditure  of  money  or  effort  to  find  a  market 
for  it,*  and  when  the  manager  of  the  Exchange  visited  some 
of  the  local  societies  fur  the  purposes  of  securing  their  business, 
which,  by  the  arrangement,  would  yield  a  small  percentage  to 
the  support  of  the  state  Exchange,  he  was  usually  regarded 
with  rather  more  suspicion  than  if  he  had  appeared  as  a  solic- 
itor for  a  commercial  concern,  and  the  few  contracts  which  he 
obtained  he  got  by  more  effort  than  a  competitive  concern 
would  have  been  obliged  to  expend. 

This,  of  course,  i)ut  both  the  Exchange  and  the  manager 
in  a  false  position,  and  they  ceased  to  solicit.     The  suspicious 


*  What  growers  would  do  was  to  first  try  every  other  possible  means  of 
selling  their  fruit,  first  carefully  getting  all  the  free  information  which  the 
Exchange  could  give  them,  and  failing  to  sell,  would  give  the  Exchange  the 
chance  of  selling,  if  it  could,  and  provided  that  the  owner  did  not  sell  otherwise. 
Evidently  it  would  not  pay  to  spend  money  to  find  customers  under  such  condi- 
tions. 


OOO  CALIFORNIA    FKUIT    SOCIETIES. 

disposition  of  the  people  was  strongly  encouraged  by  the 
more  disreputable  members  of  the  trade,  who  insinuated,  and, 
indeed,  openly  charged  that  those  officially  connected  with  the 
Exchange  were  receiving  large  private  commissions  on  all 
business  entrusted  to  it.  These  charges,  perhaps,  the  directors 
and  the  manager  were  prepared  for,  but  wliat  w^as  unquestion- 
ably a  surprise  to  them  was  the  fact  that,  well-known  as  they 
were,  not  a  soul,  so  far  as  M'as  ever  learned,  ever  openly 
expressed  his  disfaith  in  the  statements,  or  defended  the 
character  of  the  heretofore  reputable  men  whom  they  had 
asked  to  gratuitously  serve  them.  The  result  was  that  the 
contracting  firm  speedily  became  disgusted,  withdrawing  from 
the  contract  after  a  few  weeks,  no  business  ever  actually  being 
done  under  it. 

The  directors,  however,  were  determined  to  struggle  on 
under  the  load  w^iich  had  been  put  upon  them,  and  spent  the 
remainder  of  the  season  in  doing  all  that  could  be  done  in 
serving  the  common  interest.  A  little  money  was  from  time 
to  time  raised — largely  out  of  their  own  pockets — and  the 
work  continued  till  towards  the  close  of  their  year.  As  that 
approached  it  was  determined  to  make  a  final  and  determined 
effort.  As  a  result  of  the  whole  cooperative  movement  nearly 
sixty  local  cooperative  societies  were  in  existence,  the  majority 
of  which  had  been  established  as  a  direct  result  of  the  work  of 
the  Exchange,  and  largely  by  the  personal  aid  of  its  officers; 
so  much,  at  least,  it  had  done  of  the  work  which  it  was  estab- 
lished to  do,  and  it  was  ready  to  take  the  next  step,  which  was 
to  transfer  the  responsibility  for  its  continuance  and  mainte- 
nance to  the  local  societies.  To  this  end  a  convention  of  local 
societies  was  called.  Delegates  were  sent  with  written  creden- 
tials from  the  incorporated  societies  which  sent  tliem,  and 
fully  authorized  to  speak  for  them,  up  to  the  point  of  i)ledging 
money  for  the  work,  for  which  they  had  no  authority.  The 
convention  was  in  session  for  two  days,  and  thoroughly 
reviewed  the  work  of  the  past  year,  which  was  fully  approved. 
The  course  for  the  future  was  adopted  precisely  as  outlined  by 
the  management  of  the  Exchange,  which  involved  a  definite 


THE   CATJPORNTA    FRUIT    EXfllANQE.  501 

on  the  part  of  the  societies  represented,  of  a  small,  but 
in  the  aggregate  a  sufficient,  sum  for  the  support  of  the  state 
Exchange,  to  be  charged  as  an  item  of  expense  against  the 
fruit  handled  the  next  year,  by  the  local  societies,  this  being 
the  plan  as  originally  marked  out,  wheu  the  societies  should 
be  established.  The  representatives  present,  upon  a  call  of 
the  roll,  each  rose  and  promised  that  he  would  report  to  his 
society  favoring  the  endorsement  of  the  action  of  the  con- 
vention and  advising  the  pledge  of  the  required  financial 
support. 

As  the  result  of  the  meeting  it  is  not  known  what  reports 
were  made  to  the  local  societies;  in  many  cases  there  were 
none;  but,  at  any  rate,  very  few  pledges  of  the  promised  sup- 
port were  ever  received,  and  those  usually  from  the  smallest 
societies.  When  the  board  of  directors  convened,  the  tem- 
porary manager,  whose  resignation  had  been  before  the 
directors  for  some  time,  pressed  its  acceptance,  but  continued 
to  perform  the  duties  for  some  time.  This  is  mentioned  in 
order  to  add  as  a  further  illustration  of  an  unfortunate  weak- 
ness of  cooperation,  that  delegates  from  certain  societies 
declared  that  they  would  not  come  in  if  he  did  not  resign.  It 
was  a  repetition  of  the  experience  of  the  California  Fruit 
Union,  when  one  faction  would  not  stay  in  if  a  certain  man 
was  manager.  The  faction  in  this  case  was  very  small,  but  it 
was  deemed  best  to  yield  to  it,  although  the  interest  of  the 
service  required  that  the  manager  should  complete  his  work, 
and  turn  over  the  Exchange  in  working  order  to  his  suc- 
cessor, which  he  was  willing  to  do;  although  anxious  to  be 
relieved,  he  wished  to  leave  a  completed  work.  The  objec- 
tions to  the  manager  appeared  to  arise  from  his  continual 
statements  that  no  eff"ective  business  organization  on  a  large 
scale,  whether  competitive  or  cooperative,  could  be  run  with- 
out considerable  expenditure,  for  which  an  adequate  income 
must  be  assured;  this  was  considered  "visionary"  by  a  few 
good  men,  some  of  whom  doubtless  felt  sure  that  the  manager 
desired  a  good  income  for  the  Exchange  in  order  that  he 
might  become  permanent  manager,  and  obtain  a  "fat  salary" 


502  CALIFORNIA    FRUIT    SOCIETIES. 

out  of  it,*  and  this  they  desired  to  prevent  at  all  hazards; 
others  believed  that  the  ends  of  the  Exchange  could  be  accom- 
plished for  far  less  money  than  the  budget  of  the  manager 
proposed,  and  with  no  ill  will  to  him,  or  question  of  his 
honesty  or  ability,  desired  some  one  of  a  more  economical  turn 
of  mind;  and  feeling  as  they  did,  it  was  wisest  to  give  them 
an  opportunity  to  show  what  could  be  done  with  small 
expenditure.  The  result  was  as  expected,  that  they  did 
nothing. 

This  feeling  of  some  growers  toward  the  manager  of  the 
Exchange  and  his  plans  very  well  illustrates  the  unwilling- 
ness of  farmers  to  permit  those  serving  them  cooperatively  to 
receive  for  their  services  any  such  compensation  as  competitive 
business  offers  for  similar  services;  it  also,  possibly,  shows  the 
unwisdom  of  making  any  trained  business  man  a  responsible, 
salaried  officer  of  a  cooperative  society  at  its  beginning.     An 


*It  seems  impossible  for  the  majority  of  farmers  to  believe  that  any  one  will 
actively  promote  cooperative  movements  except  with  the  intent  to  profit  by 
them.  As  a  matter  of  fact,  promotion  of  such  work  is  always  largely  altruistic. 
In  California,  those  engaged  in  it,  if  they  devote  their  entire  time,  expect  their 
expenses  and  a  small  salary  to  compensate  them  for  the  neglect  of  their  own 
business.  In  this  case  the  temporary  manager  was  a  person  in  fairly  comfort- 
able circumstances  who  neither  sought  nor  desired  the  employment,  and  stipu- 
lated from  the  first  that  he  would  serve  only  until  the  right  man  appeared  to 
go  on  with  the  work.  This  fact  was  publicly  stated  upon  all  proper  occasions, 
partly  in  hopes  that  the  announcement  would  bring  out  the  right  man,  and 
partly  to  allay  the  suspicions  of  personal  interest  which  were  fully  anticipated. 
It  would  not  do.  Members  of  the  trade  who  were  adverse  to  the  movement 
circulated  lies  about  the  president  and  manager,  which  were  generally  believed, 
because  these  officers  were  necessarily  personally  unknown  to  the  majority  of 
the  fruit-growers.  As  a  matter  of  fact  the  president  devoted  a  large  part  of  his 
time  for  a  year  to  the  Exchange,  paying  even  his  personal  expenses,  with,  as 
events  proved,  very  severe  loss  from  neglect  of  his  own  business.  The  manager 
did  Jiot  lose  so  much  because  he  had  not  so  much  to  lose,  but  his  neglect  of  his 
own  attairs  resulted  quite  seriously  to  him.  Neither  of  these  gentlemen  have 
since  had  anything  to  do  with  cooperative  work,  except  merely  to  cooperate, 
and  probably  neither  could  be  induced  to  again  accept  responsibilitj'  in  business 
cooperation  of  an  important  nature.  Of  course  this  is  not  the  stuft"  that  great 
cooperators  are  made  of,  but  it  is  the  stuff  that  int)st  liiiinan  beings  are  madeof. 
Suspicion  and  ingratitude  deprive  the  public  of  nuicli  service  which  would  be 
gladly  rendered  by  those  who,  while  altruistic,  arc  not  altruistic  enough  to 
patiently  endure  much  bad  usage. 


THE    CALIFORNIA    FRTTIT    EXCHANGE.  508 

experienced  man,  knowing  the  detail  of  business,  and  its  neces- 
sary cost,  if  he  is  lionest,  must  make  an  estimate  of  expense  which 
seems,  to  farmers,  very  extravagant;  if  he  needs  or  desires  the 
position,  he  will  be  tempted  to  make  inadequate  estimates,  in 
order  to  encourage  liis  people  and  retain  his  place.  The  most 
successful  cooperative  enterprises  have  grown  from  small  begin- 
nings, conducted  by  inexperienced  men  whose  ideas  expanded 
with  experience.  The  circumstances  of  the  California  fruit- 
grower seemed  to  render  it  desirable  to  begin  operations  on  a 
large  scale;  selling  goods  in  large  quantities,  from  first  hands, 
requires  a  rarer  ability  and  costs  much  more  money  than  buy- 
ing goods,  or  than  selling  at  retail,  and  this  is  true  whether 
the  operations  be  conducted  on  a  cooperative  or  competitive 
basis.  For  operations  on  this  scale  farmers  are  not  well  pre- 
pared; and  when,  as  in  this  case,  the  management  pointed  out 
the  detail  of  selling  fruit  as  conducted  by  those  in  the  trade, 
and  estimated  the  necessary,  but  much  smaller,  expense  of 
the  same  work  done  in  the  same  way,  but  cooperatively,  and 
wholly  in  the  growers'  interest,  many  at  once  lost  confidence, 
and  were  inclined  to  listen  to  those  who  proposed  to  accom- 
plish large  results  with  trifling  expenditure.  If  cooperation 
can  accomplisli  this,  it  will  be  a  great  boon,  but  the  danger  to 
be  appreliended  in  the  attempt  is  the  furnishing  of  an  ineffect- 
ive service,  which  will  not  satisfy  those  who  are  to  support 
it,  or  be  able  to  retain  their  business.  Tiie  experience  of  the 
state  Exchange  also  made  it  quite  evident  that  it  was  more 
difficult  to  unite  a  large  number  of  societies  under  a  common 
head  than  to  bring  individuals  into  the  local  societies.  The 
moment  there  is  a  feeling  of  strength,  there  is  an  unwilling- 
ness to  cooperate.  Tlie  local  societies  seemed  to  the  small 
farmers  who  controlled  them,  perfectly  able  to  stand  alone;  to 
this  was  added  a  certain  amount  of  sectional  jealousy.  The 
Santa  Clara  societies,*  especially,  felt  that  their  district  was  the 
largest  producer  of  dried  fruit,  and  should  be  the  headquarters 
of  cooperative  action.  The  Santa  Clara  societies,  also,  having 
enjoyed  the  reputation  of  leadership  in  cooperation,  were 
unquestionably,  although  quietly,  averse  to  the  establishment 
of  any  state  Exchange  which  should  seem  to  put  them  in  a 


504  CALIFORNIA    FRUIT   SOCIETIES. 

subordinate  position.  Tlieir  officers,  generally,  knew  little  oi 
the  fruit  interests  of  the  state  outside  of  their  own  valley,  and 
were  not  moved  by  conceptions  including  all  interests.  The 
result  of  the  whole  movement  was  finally  a  suspension  of 
active  work  on  the  part  of  the  state  Exchange,  with  the  intent 
to  let  the  growers  of  the  state  grow  up  to  a  comprehension  of 
the  proper  work  of  such  a  body,  the  necessity  of  its  prosecution, 
and  the  wisdom  of  uniting  in  the  expense  of  sustaining  it. 
Whether  this  will  ever  happen  remains  to  be  seen. 


CHAPTER    VII. 

THE    CITRUS    EXCHANGES    OF    SOUTHERN    CALIFORNIA. 

IN  all  ages  the  orange  grove  has  been  the  emblem  of  the 
beauty  and  the  poetry  of  horticulture,  and  in  truth  there 
is  not,  in  all  cultivated  nature,  any  sight  more  beautiful 
than  it  affords.  To  the  stranger,  coming  with  imagination 
already  stimulated  with  glowing  descriptions,  the  transition 
from  the  icy  blasts  and  leaden  skies  of  the  eastern  winter  to 
the  warm  sun  and  the  pleasant  breezes  of  a  February  day  in 
California,  is  very  grateful,  and  the  next  day's  drive  among 
the  laden  orange  groves  completes  the  fascination,  and  makes 
the  wayfarer  a  willing  victim  to  the  combined  seductions  of 
the  climate  and  the  landseller.  The  rise  of  southern  California 
began  with  the  completion  of  direct  rail  communication 
between  Los  Angeles  and  the  East.  The  circumstances  were 
propitious.  The  large  Spanish  grants  which  covered  the  most 
desirable  lands  had  mostly  passed  into  American  hands,  and 
were  available  for  subdivision,  and  capitalists  or  strong  com- 
panies, buying  or  bonding  large  tracts  at  low  prices,  could 
afford  to  spend  large  sums  in  attracting  immigration.  The 
owners  of  the  new  railroad,  earnestly  desiring  traffic  therefor, 
joined  hands  with  the  land  speculators,  and  their  combined 
efforts,  in  the  course  of  two  or  three  years,  produced  a  land- 
buying  and  orange-planting  craze,  which  attracted  the  atten- 
tion of  the  world.  The  attractiveness  and  productiveness  of 
the  country  were  not  overstated;  indeed,  it  would  be  diffi- 
cult to  do  so;  the  errors  of  investment  which  were  made  grew 
out  of  exaggerated  impressions  of  the  cheapness  of  cultivation, 
the  certainty  of  large  crops,  and  the  assurance  of  the  sale, 
at  high  prices,  of  any  producible  quantity  of  the  fruit.  With 
authentic  statements  before  him,  of  orchards  yielding  many 
hundreds  of  dollars  per  acre,  the  newcomer  of  a  few  years 
since  was  in  no  condition  to  inquire  into  the  drawbacks,  if 

(505j 


506  CALIFORNIA    FRUIT    SOCIETIES. 

any,  or  dispute  the  enthusiastic  assertions  that  the  world  was 
and  always  would  be  clamoring  for  the  product,  and  that  the 
happy  producer  had  only  to  name  his  price.  And  it  seemed 
reasonable.  Before  their  eyes  they  saw  the  great  packing- 
houses thronged  with  workers,  and  the  orchard  owners  watch- 
ing from  verandas  the  harvesting  of  their  crops  by  those  to 
whom  they  had  sold  them  on  the  trees.  Allured  by  these 
manifestations  of  success,  and  by  the  rapid  building  of  the 
towns  and  cities  which  thrived  by  it,  southern  California  was 
rapidly  peopled  by  an  exceedingly  enterprising  community  of 
solid  principles  and  sterling  worth. 

The  fundamental  error  in  the  calculation  of  the  citrus 
Buthusiasts  was  in  supposing  that  the  phenomenal  incomes  of 
the  early  orange-growers  could  long  continue  in  the  face  of  the 
wide  area  of  the  earth  adapted  to  orange  culture,  with  sea  trans- 
portation to  America  enough  cheaper  than  any  transconti- 
nental movement  ever  could  be,  to  overcome  any  duty  to 
which  the  country  would  probably  submit.  The  orange, 
under  favorable  circumstances,  is  a  great  bearer,  and  it  was 
only  a  question  of  time  to  fill  vacant  land  with  orange  groves 
to  glut  the  market.  Of  the  special  drawbacks  I  can  not  speak 
30  well,  as  I  have  not  myself  raised  oranges;  I  only  know  that 
much  of  what  I  have  said  in  regard  to  the  cultivation  of 
deciduous  fruits  applies  equally  well  to  orange  culture,  and  in 
a  still  greater  degree  to  the  cultivation  and  curing  of  lemons; 
there  is  no  more  poetry  in  ploughing  orange  groves  than  in 
ploughing  cabbages;  the  care  of  a  single  variety,  while  sim- 
pler than  that  of  a  mixed  orchard  of  deciduous  fruits,  is  also 
more  monotonous;  the  orange,  while  thriving  wonderfully  in 
suitable  locations,  does  not  do  well  everywhere,  and  there  are 
thousands  of  acres  of  orange  groves  which  should  never  have 
been  planted,  and  which  never  can  yield  a  profit;  the  crop  is 
exhausting  to  the  soil,  and  an  extensive  use  of  fertilizers  is 
required;  the  annual  water  tax  is  a  burden  never  to  be  avoided, 
and  irrigation  provokes  the  growth  of  weeds  as  well  as  of  fruit. 
For  some  years  it  seemed  likely  that  the  scale  insects  would 
destroy  tlie  groves,  and  when,  after  many  costly  experiments, 
that  pest  was  in  a  great  measure  overcome,  the  owners  of  many 
unprofital)le  orchards  had  bocome  almost  impoverished. 


SOUTHERN    CALIFORNIA    CITRUS    EXCHANGES.  507 

Witli  improved  methods  of  combating  the  scale,  and  tlie 
increased  output  resulting,  more  and  more  of  the  later  plant- 
ings came  into  bearing,  and  gradually  the  once  prosperous 
orange-growers  began  to  pass  through  the  experience  of  the 
fresh  deciduous  fruit  shippers  and  the  raisin  men  already 
described.  Under  a  constantly  falling  market  the  packers  were 
more  and  more  cautious  about  buying  the  crop  on  the  trees,  and 
finally  ceased  buying  at  all,  and  the  era  of  consignment  set  in, 
with  the  same  result  that  occurred  in  the  deciduous  fruit 
industries;  the  fruit  often  brought  less  than  the  cost  of  produc- 
tion and  delivery  east,  and  sometimes  less  than  the  freight  and 
charges  alone.  In  no  case  would  the  product  do  much,  if  any- 
thing, toward  meeting  the  interest  charges,  or  paying  off  mort- 
gages; more  and  more  the  weaker  growers  who  were  largely 
in  debt  for  land  and  improvements  obtained  at  high  prices, 
began  to  fall  behind,  and  a  disaster  seemed  imminent,  which, 
involving  as  it  did  the  main  industry  of  the  country,  would 
be  appalling  in  its  results. 

In  this  crisis  the  natural  thought  of  all  was  toward 
cooperation.  For  this  form  of  selling,  the  citrus  industry  was 
far  more  favorably  situated  than  the  deciduous  fresh  fruit 
industry;  confined  to  one  product  far  less  perishable,  and 
bearing  transportation  better  than  most  deciduous  fruits, 
reaching  market  in  the  winter,  when  no  refrigeration  was 
required,  and  the  market  bare  of  other  fresh  fruits,  the  prin- 
cipal varieties  few  and  well  known,  and  the  method  of  grad- 
ing by  size,  very  simple,  the  problem  of  selling  was  far  easier 
than  that  of  marketing  any  other  fruit  except  raisins.  Instead 
of  being  scattered  over  a  whole  state,  tlie  growers  were  con- 
centrated in  three  or  four  counties,  and  along  irrigation 
systems,  where  they  could  be  reckoned  up  and  visited;  as 
citrus  fruits  are  only  sold  fresh,  tiiere  was  no  such  complica- 
tion of  interests  as  existed  between  the  dried  and  fresh 
deciduous  fruit  sliipi)ers  of  the  north ;  in  a  word,  not  only  was 
the  problem  of  selling  simpler,  but  the  work  of  organization 
easier.  Added  to  this,  the  larger  capital  required  to  plant  and 
mature  an  orange  grove,  together  with  the  peculiar  excitement 
attending  the  development  of  the  country,  had   drawn  into 


508  CALIFORNIA    FRUIT    SOCIETIES. 

the  business  more  men  of  business  aptitude  and  experience 
than  were  engaged  in  any  other  brancli  of  the  fruit  in- 
dustry, so  that  the  problem  was  not  only  more  simple  than 
that  of  the  north,  but  the  people  were  better  qualified  to  deal 
with  it ;  or  at  least  it  can  be  said  that  from  an  early  date  the 
cooperative  movement  in  southern  California  commanded  the 
adhesion  and  energy  of  many  of  the  large  and  wealthy 
orchardists,  which  the  northern  movement  seldom  did.  The 
result  was  that  when  the  problem  was  attacked  the  movement 
had  greater  force,  stronger  support,  and.  better  direction  than 
was  for  a  long  time  attained  by  the  northern  movements. 

At  an  early  date  there  were  cooperators  in  the  orange 
business.  In  1888  or  1889  there  was  formed  the  Pachappa 
Fruit  Association,  in  a  district  about  two  miles  from  Riverside, 
which  attempted,  in  a  very  crude  way,  to  accomplish  about 
the  objects  of  the  northern  fresh  fruit  shipping  associations 
already  described.  As  one  of  the  original  founders  lately 
expressed  himself  to  me,  they  knew  very  little  of  the  orange 
marketing  business,  and  groped  about  rather  blindly  and  with- 
out much  effect.  Their  original  idea  seems  to  have  been  a 
simple  neighborhood  agreement  to  hold  their  fruit  for  the 
highest  price  obtainable  from  the  local  buyers,  and  to  sell 
all  together.  Afterwards  they  undertook  their  own  shipping, 
with  no  flattering  results.  They  were  not  incorporated,  and 
of  course  did  not  hold  together  very  well,  but  the  persistence 
of  some  led  to  a  continued  study  of  the  subject,  and  prepared 
the  way  and  made  possible  the  better  achievements  of  a  later 
(hiy.  In  1892  the  Riverside  Fruit  Exchange  was  organized, 
under  the  auspices  of  some  of  the  solid  men  of  Riverside,  and 
continued  in  operation  during  the  year.  With  the  details  of 
this  enterprise  I  am  not  familiar;  it  was  intended  as  an 
organization  to  market  the  fruit  of  its  members,  but  it  never 
had  any  such  general  adherence  of  growers  as  to  render  it 
master  of  the  situation,  and  the  manager,  who  was  an 
experienced  and  able  man,  seems  to  have  been  allowed  what 
he  could  make  it  ]n\y  him  by  commissions.  It  did  a  good 
business,  in  a  maiuur  presumably  satisfactory  to  those  who 
sold  through  it,  and  was  a  step  along  the  path  it  was  desired 
to  follow. 


SOITHEKN    CALIKOKMA    (  ITKLS    EXCHANGES.  509 

In  March,  1893,  a  mass  meeting  of  orange-growers  was 
called  to  meet  at  Colton,  during  the  progress  of  a  citrus  fair 
at  that  place;  the  attendance  was  not  large  but  the  interest 
manifested  by  those  present  warranted  an  adjournment  for  a 
week  in  the  expectation  of  a  larger  number.  At  the  adjourned 
meeting  a  clear-lieaded  gentleman  from  Riverside,  who  had 
been  educated  for  some  years  in  the  experience  of  the 
Pachappa  and  Riverside  Associations,  of  the  first  of  which, 
at  least,  he  was  a  member,  outlined  a  plan  of  operations  by 
which,  as  he  believed,  the  growers  could  be  united,  and  their 
crop  marketed  at  less  expense  than  had  been  usual,  and  with 
far  better  results.  Substantially  it  was  to  be  an  orange 
Trust,*  designed  to  embrace  all  producers,  and  to  market  the 
fruit  of  all,  sending  forward  only  what  could  be  sold  at  rates 
to  give  the  grower  someihing  above  marketing  expenses,  and 
apportioning  the  shipments  among  growers  in  proportion  to 
their  recorded  crop,  so  that  if  any  fruit  should  be  left  over 
unsold,  that  unsalable  surplus  would  be  borne  by  all  alike. 
It  was  to  become  binding  among  those  agreeing  to  unite, 
whenever  seventy-five  per  cent  of  the  growers  had  signed  the 
agreement.  This  form  of  organization  was  made  possible  by 
the  concentration  of  the  orange  industry  in  a  few  contiguous 
counties,  so  that  every  producer  could  be  ascertained  and 
visited.  The  raisin  industry  affords  an  opportunity  for  a 
similar  organization,  and  the  successful  attempts  of  the 
raisin-growers  toward  that  end  have  already  been  described. 


*This  paragraph  was  written  in  1894,  and  the  manuscript  of  the  history  to 
that  date  was  submitted  to  a  prominent  officer  of  the  southern  Exchanges,  for 
correction.  This  gentleman  reported  the  facts  correctly  stated,  but  vigorously 
denounced  the  term  "Trust"  as  applied  to  an  innocent  society  of  horny- 
handed  farmers.  I  was  obliged  to  reply  to  the  gentleman  that  as  I  could  see 
no  difference  between  the  aims  and  methods  of  those  societies  and  those  of  the 
other  industrial  organizations  popularly  known  as  "Trusts,"  or  any  difference 
except  in  effectiveness,  it  seemed  desirable  to  include  all  under  the  name 
which  was  commonly  in  use.  Since  that  time  this  squeamishness  has  mostly 
disappeared.  Farmers  generally,  in  California,  understand  very  well  that 
producers'  marketing  societies  which  seek  to  control  an  entire  product  do  not, 
in  principle  or  methods,  materially  differ  from  organizations  of  other  interests 
for  the  accomplishment  of  the  same  object. 


510  CALIFORNIA    FRUIT    SOCIETIES. 

The  convention  was  so  much  pleased  with  the  outline 
proposed  by  the  Riverside  grower  that  he  was  requested  to 
formulate  it  in  full  for  general  distribution,  and  a  further 
adjournment  of  a  week  was  taken,  to  meet  at  Los  Angeles. 
At  the  Los  Angeles  meeting,  which  was  the  largest  yet  held,  it 
was  resolved  to  proceed  to  organization,  and  a  committee, 
headed  by  the  author  of  the  plan,  was  appointed  to  promote 
it.  At  a  subsequent  meeting,  a  month  later,  many  local  meet- 
ings in  the  citrus-growing  centers  having  been  held  in  the 
meantime,  and  growers  generally,  through  the  press  and  other- 
wise, having  been  made  familiar  with  the  plan,  it  was  finally 
agreed  upon  substantially  as  originally  proposed.  Proper  pro- 
vision was  also  made  for  the  expenses  of  organization. 

The  plan  was  simple  and  business  like.  It  provided  for: — 
1.  Local  neighborhood  Associations,  owning  the  necessary 
packing  facilities,  and  for  that  purpose  incorporated.  To  these 
local  packing-houses  the  grower  delivered  his  oranges  in  bulk, 
just  as  he  had  been  accustomed  to  deliver  them  to  the  packing- 
houses of  the  buyers  or  commission  men,  and  they  were  there 
graded  and  boxed,  with  those  of  others,  each  grower  getting  a 
receipt  showing  the  amount  and  the  grade  of  fruit  delivered. 
This  ended  the  duty  of  the  grower;  from  that  time  on  his  fruit 
was  mingled  with  that  of  other  growers,  and  marketed  by  his 
Association. 

.  2.  District  "Exchanges,"  composed  of  representatives  from 
each  Association  in  the  district.  These  Exchaiiges  received 
the  orders  and  apportioned  them  among  the  local  Associations 
in  proportion  to  their  total  crops,  previously  ascertained,  by 
each  Association,  by  actual  canvass.  As  orders  were  received 
and  apportioned,  each  Association  directed  its  members  to  pick 
and  deliver  their  fruit.  The  intent  was  to  ship  only  such  fruit 
as  was  actually  sold  before  picking.  The  district  Exchange 
attended  to  the  shipments,  collected  the  returns,  and  distributed 
to  the  local  Associations,  which  paid  them  to  the  owners  of  the 
fruit.  Thus  the  local  societies  attended  to  the  collection  and 
packing,  and  the  district  Exchanges  to  the  shipment  and  col- 
lection. The  district  Exchanges  were  not  incorporated.  The 
districts  were  made  large  enough  to  supply  business  sufficient 


SOUTHERN    CALIFORNIA    (ITKUS    KXCHANGES.  oH 

to  justify  the  employment  of  a  competent  secretary  for  each, 
devoting  his  entire  time  for  the  year. 

3.  An  Executive  Board  consisting  of  a  representative  from 
each  district  Exchange,  which  should  have  entire  charge  of 
the  appointment  of  eastern  agencies,  and,  in  general,  of  fixing 
prices,  making  sales,  prorating  the  orders  to  the  Exchanges, 
and  attending  to  such  other  duties  as  ])ertained  to  the  general 
policy  to  be  pursued  or  tended  to  the  welfare  of  all.  The 
intention  was  that  the  Executive  Board  should  make  all  the 
sales  and  prorate  the  orders,  but  in  practice  many  sales  were 
made  by  the  district  Exchanges,  the  Executive  Board,  however, 
retaining  control  of  prices,  so  far  as  it  was  necessary  to  do  so. 
The  method  of  business  pursued,  after  the  completion  of  the 
organization,  was  for  each  local  association  to  annually  can- 
vass the  district  allotted  to  it,  contracting  with  each  grower  for 
his  crop  for  the  season.  As  all  expenses  incurred  were  a  first 
charge  on  the  proceeds  of  the  fruit  handled,  no  capital  was 
required,  except  for  packing  facilities  for  the  local  associations. 

The  above  form  of  organization  having  been  agreed  upon, 
and  provision  made  for  the  expenses  of  organization,  the 
entire  summer  and  autumn  was  devoted  to  local  meetings  and 
a  house-to-house  canvass  of  the  growers.  The  same  ditliculties 
were  met  here  that  have  been  described  in  connection  with 
the  deciduous  fruit  societies,  but  the  movement  having  the 
support  of  the  wealthier  men  of  the  community,  the  strength 
to  overcome  the  difficulties  was  far  greater.  The  commission 
houses  which  had  controlled  the  business  did  not  wish  to  lose 
it,  and  did  not  intend  to  if  they  could  help  it,  no  matter  what 
became  of  the  growers,  and  by  means  of  free  advances  to  those 
in  need  of  them,  they  retained  control  of  a  good  deal  of  fruit; 
then,  of  course,  was  the  contem])tible  class  found  in  every 
community,  of  those  who  saw  plainly  the  general  benefit  to  be 
derived,  and  who  had  not  the  excuse  of  poverty  to  plead,  but 
who  still  held  aloof  from  the  movement,  hoping  and  expecting 
to  reap  some  personal  advantage  at  the  expense  of  their  neigh- 
bors. Many  of  this  class  were  dragged  in  by  the  pressure 
brought  to  bear  on  them,  but  some  stayed  out.  I  do  not  wish 
it  to  be  understood  as  complaining  of  those  who  saw  no  advan- 


512  CALIFORNIA    FRUIT    SOCIETIES. 

tage  in  the  movement  for  not  joining  and  assisting  in  it;  no 
one  should  be  forced  into  a  business  transaction  against  his 
convictions;  but  there  were  apparently  no  such  persons 
among  the  orange-growers;  all  knew,  and  usually  acknowl- 
edged, that  nothing  else  would  prevent  a  general  bankruptcy 
among  the  orange-growers  who  were  in  debt,  and  loss  and 
trouble  to  all  others,  and  I  refer  to  those  who  believed  this 
and  yet  would  not  cooperate. 

In  the  end  more  than  seventy-five  per  cent  of  the  growers 
signed  contracts  for  their  fruit,  and  by  November  the  organiza- 
tion was  practically  complete  and  the  Executive  Board  se- 
lected. Representatives  were  sent  east  to  lay  their  plans  before 
the  trade,  and  a  competent  general  eastern  agent  appointed. 
With  a  less  amount  of  friction  than  was  to  be  expected  in  a 
new^  organization  of  the  kind,  the  business  of  the  season  of 
1894  was  managed  to  the  general  satisfaction  of  those  con- 
cerned. The  Exchanges  did  not  do  all  they  hoped  to  do,  but 
they  did  so  manage  the  business  as  to  bring  the  growers  better 
returns  than  they  had  received  for  years,  and  on  the  whole 
such  as  they  could  live  by.  One  immediate  result  was  the 
reappearance  of  the  local  cash  buyer,  an  unfailing  evidence  of 
a  stiffening  in  the  market.  The  unhoped-for  opportunity  to 
sell  for  cash  at  home  proved  too  much  for  the  good  faith  of  a 
few,  and  in  defiance  of  their  written  contract,  they  sold  their 
fruit  to  go  into  competition  with  the  Exchanges;  suits  w^ere 
promptly  brought,  and  the  court  sustained  the  contracts. 
Much  was  learned  as  to  the  best  method  of  conducting  the 
business,  but  it  was  with  reference  to  detail,  and  did  not 
involve  the  principle  of  the  organization,  which  remained 
unchanged.  At  the  close  of  the  season  the  canvass  for  con- 
tracts for  1895  promptly  began,  and  about  ninety  per  cent  of  the 
product  secured,  and  the  business  of  that  year  was  transacted 
to  the  general  satisfaction  of  the  membership.  Some  changes 
of  methods  and  organization  were  made,  as  shown  by  experi- 
ence to  be  desirable.  The  Executive  Board  found  it  neces- 
sary to  incorporate  in  order  to  do  business  legally,  and  did 
so,  under  the  name  of  the  "Southern  California  Fruit  Ex- 
changes," with  a  permanent  office  in  Los  Angeles.     The  stock 


SOUTHERN   CALIFORNIA    CITRUS   EXCHANGES.  513 

is  nominal.     It  is  probable  that  the  district  Exclianges  have 
also  incorporated. 

The  Exchanges,  however,  did  not  find  it  all  plain  sailing. 
There  were  dissensions  among  themselves.  The  fruit  of  some 
localities  was  better  than  that  of  others,  or  at  least  better 
known,  or  believed  to  be  better,  and  at  any  rate  was  in  most 
demand.  It  was  found  that  at  a  uniform  price  the  fruit  from 
these  localities  would  be  taken  first,  leaving  that  of  other  local- 
ities largely  in  the  orchards,  until  the  better  or  the  better 
known  products  had  been  disposed  of.  The  favored  districts 
thereupon  strenuously  objected  to  the  prorating  of  orders, 
according  to  the  plan,  stoutly  insisting  that  they  were  entitled 
to  the  benefit  of  the  better  reputation  of  their  fruit.  The  east- 
ern buyers,  also,  insisted  that  when  their  orders  specified  the. 
fruit  of  any  locality,  they  must  be  supplied  with  the  fruit  of 
that  locality,  and  no  other.  The  less-favored  districts,  on  the 
other  hand,  insisted  with  equal  vigor  that  they  could  not  be 
expected  to  engage  in  an  enterprise  for  the  general  good  whose 
result,  to  them,  should  be  the  leaving  a  large  share  of  their 
fruit  on  their  hands,  at  least  until  tlie  close  of  the  season.  The 
result  was  a  great  amount  of  internal  friction,  and  a  proba- 
bility, ill  1896,  that  the  Central  Exchange  would  be  discon- 
tinued, and  that  the  local  Exchanges  would  compete  freely 
among  themselves.  This  was  finally  prevented,  by  a  close  vote 
in  some  of  the  Exchanges,  with  the  result,  however,  that  a 
niwnber  of  independent  local  Exchanges  were  organized  and 
are  still  maintained.  These  usually  sell  their  fruit  loaded  on 
the  cars  at  home.  Those  in  the  best-known  localities  sell 
mostly  upon  telegraphic  orders  from  eastern  buyers,  tlie  others 
usually  selling  to  local  buyers.  The  main  body,  known  as  the 
"Southern  California  Fruit  Exchanges,"  maintains  a  corps  of 
agents  in  the  east  who  supervise  the  business  there,  directing 
the  cars,  when  on  the  way,  to  the  points  where  the  best  demand 
exists,  and  arranging  for  sale,  either  by  auction  or  through 
brokers,  upon  arrival.  The  sales  of  these  Exchanges,  includ- 
ing the  independent  societies,  for  the  past  year  have  been 
$2,067,902,  after  deducting  freights  paid,  and  as  to  some  por- 
tion at  least,  all  expenses  of  every  kind. 
38 


514  CALIFOK^•lA    FKUIT    SOCIETIES. 

Encouraged  by  these  dissensions  among  the  growers,  the 
forwarding  houses  which,  during  1894  and  1895,  had  gener- 
ally been  compelled  to  close  their  establishments,  returned  in 
full  force  and  recommenced  business,  and  for  a  year  or  two 
there  was  a  very  bitter  triangular  war  between  the  associated 
and  independent  Exchanges  and  the  commission  merchants. 
Each  year  there  was  an  active  and  expensive  canvass  on  the 
part  of  the  Exchanges,  for  contracts,  which  was  more  or  less 
openly  opposed  by  the  forwarders,  the  contest  being  accom- 
panied by  a  wonderful  outpouring  of  printer's  ink  and  bad 
language.  The  associated  Exchanges,  in  the  face  of  such 
opposition  and  misrepresentation,  were  unable  to  longer  secure 
seventy-five  per  cent  of  the  crop,  and  the  practical  control  of 
the  market,  nor  could  they  do  so  with  the  aid  of  the  independ- 
ent Exchanges,  with  whom,  had  that  been  done,  some  common 
plan  of  action  could  have  been  arranged.  In  the  end  these 
annual  contests  were  abandoned.  The  Exchanges,  as  I  under- 
stand it,  have  ceased  to  solicit,  and  do  only  the  business  which 
the  cooperative  element  voluntarily  brings  to  them.  This 
business,  as  has  been  stated,  is  large,  well  managed,  satisfactory 
to  the  membership,  and  appears  to  be  increasing.  They  seem 
to  control  about  one-third  of  the  citrus  product.* 


*The  following  letter,  received  after  the  text  was  prepared,  from  Mr.  A.  H. 
Naftzger,  president  of  the  Southern  California  Fruit  Exchanges,  will  be  found 
of  interest,  as  giving  some  details  for  which  there  is  hardly  space  in  the  text. 
Mr.  Naftzger  says: — 

"Referring  to  your  favor  of  late  date,  I  have  to  say  that  there  is,  perhaps, 
not  much  that  is  new  to  be  said  on  the  subject  of  the  cooperative  system  among 
citrus  fruit-growers  of  California.  So  much  has  been  said  and  written,  that 
perhaps  every  phase  of  the  subject  has  been  thoroughly  gone  into. 

"  However,  as  you  say  that  your  information  brings  the  matter  down  to 
1894,  there  may  be  some  facts  of  later  development  not  unimportant,  I  shall 
not  attempt  to  give  you  anything  that  would  be  in  form  for  the  printer.  I  take 
it,  you  simply  want  me  to  make  such  suggestions  as  might  be  serviceable  to  you. 

"The  Exchange  system  was  rather  crude  in  the  year  1894,  in  fact,  we  did  not 
incorporate  until  1895,  since  which  time  we  have  been  in  shape  to  operate  in  a 
business-like  way.  You  ask  if  we  still  canvass  for  signatures  from  year  to  year. 
I  am  not  entirely  familiar  with  the  amount  of  work  that  is  done  in  the  different 
communities,  but  I  am  under  the  impression  that  the  local  Exchanges  and 
Associations  arc  generally  organized  now,  and  have  either  contracts  for  a  term 


SOUTHi;jlN    ('AMFOKXIA    CITRUS    EXCHANGES,  515 

of  years,  oi*  make  the  growers  stockholders  of  a  corporation,  and  are  governed 
by  its  by-laws. 

<'  I  think  it  sufficient  to  say  that  very  little  work  is  done  to  induce  growers 
to  connect  themselves  with  the  Exchange.  Our  business  is  on  a  sound  and 
legitimate  basis,  and  unless  the  grower  sees  it  to  his  advantage  to  join  it,  it  is 
quite  as  well  for  the  movement,  perhaps,  that  he  remain  out.  If  he  comes  in 
voluntarily,  it  is  because  he  has  confidence  in  the  system,  and  if  he  were  not 
convinced  that  the  system  was  advantageous  he  would  probably  be  more  or  less 
of  a  disturbing  element  if  he  came  in. 

"The  Southern  California  Fruit  Exchange  acts  purely  and  solely  as  a  mar- 
keting agent  for  the  various  local  Exchanges,  of  which  there  are  twelve.  The 
local  Exchanges  and  Associations  connected  with  it  determine  all  the  questions 
of  grading,  packing,  etc.,  and  we  have  to  do  with  the  goods  when  they  are  put 
on  board  the  cars  ready  to  go  forward. 

"We  have  what  we  believe  to  be  the  most  thorough  organization  and 
system  that  has  ever  been  organized  for  the  handling  of  perishable  products. 
We  have  our  own  salaried  agents  in  the  principal  cities  of  the  United  States 
whose  sole  business  is  to  sell  our  goods. 

"  In  Chicago  we  have  a  general  agent,  into  whose  office  all  the  agents  report 
regarding  the  market  conditions  in  their  districts  every  day,  and  this  office  in 
Chicago,  acting  as  a  Clearing  House,  gives  back  to  the  difi'erent  agents  the  con- 
ditions in  all  other  markets.  By  this  system  all  of  our  agents  are  kept  thoroughly 
advised  of  the  markets  in  all  other  portions  of  the  United  States,  and  the  agents 
are  therefore  afforded  the  best  possible  weapons  for  use,  and  the  best  possible 
argument  to  enable  them  to  bring  their  markets  up  to  the  average.  This  system 
enables  us  also  to  gauge  the  requirements  of  the  different  markets  and  distribute 
the  fruit  according  to  the  wants  of  the  different  places. 

"Of  course  this  can  not  be  so  thorough  and  effective  as  if  we  controlled 
eighty  or  ninety  per  cent  of  the  crop. 

"Perhaps  the  best  proof  that  we  have  thoroughly  organized  and  systema- 
tized our  business  is  the  fact  that  during  the  season  of  189G-7  we  sold  one 
million  six  hundred  thousand  dollars  worth  of  citrus  fruits,  and  sustained  a 
total  loss  of  two  hundred  and  twenty  dollars  from  bad  accounts.  During  the 
season  of  1897-8  our  sales  exceeded  three  millions  of  dollars,  and  our  loss  from 
bad  accounts  amounted  to  six  hundred  dollars.  So  far  this  season  we  have  sold 
over  two  thousand  car-loads,  the  aggregate  amount  I  am  not  able  to  state,  and 
thus  far  this  season  we  have  not  suffered  any  loss  from  bad  accounts. 

"  This  record  I  believe  to  be  unparalleled.  I  feel  absolutely  safe  in  stating 
that  we  get  more  money  for  our  fruit  than  is  obtained  through  any  other  chan- 
nels for  any  large  amount  of  like  grades  and  qualities.  Our  system  gives  us  the 
advantage  of  a  rise  in  the  market  afterdate  of  shipment,  as  we  sell  delivered 
instead  of  free  on  board  cars.  This  season  the  markets  have  been  almost 
steadily  advancing  from  the  middle  of  January  to  the  middle  of  April,  and  we 
have  had  large  benefits  from  selling  delivered,  as  against  free  on  board 
sales.  It  is  well  known,  that  if  the  markets  decline,  the  so-called  free  on  board 
sales  are  '  rejected  '  anyway,  so  that  by  our  system  we  do  not  stand  to  lose,  but 
have  always  an  opportunity  to  gain  on  a  rising  market. 


516  CALIFORNIA    FKUIT    SOCIETIES. 

"  I  may  say  that  our  cost  for  marketing  last  year  on  a  more  than  three  mil- 
lions of  dollars  gross  sales  was  approximately  three  and  a  half  per  cent, 
covering  all  expenses  and  charges  of  every  kind  from  the  time  the  fruit  was 
put  into  our  hands  until  the  proceeds  were  returned  to  the  shippers. 

"Our  business  is  not  so  large  this  year  as  last,  because  the  crop  is  much 
lighter. 

"  It  is  certainly  believed  by  the  citrus  fruit-growers  generally,  and  I  think, 
that  the  Exchange  is  here  to  stay.  Its  system  is  correct,  and  we  can  certainly 
operate  more  cheaply  and  with  better  results  than  under  any  other  method  that 
has  been  tried  so  tar. 

"  We  have  repeatedly  publicly  challenged  a  comparison  of  figures  either  as 
to  net  results  or  operating  expenses — the  first  might  apply  to  all  shippers,  and 
the  second,  of  course,  could  only  legitimately  and  fairly  apply  to  associations 
that  are  operating  on  a  cooperative  basis — but  so  far  our  challenge  has  not  been 
answered.  I  am,  very  truly, 

"A.  H.  Naftzger." 


CHAPTER    VIII. 

THE   wine-makers'    CORPORATION. 

THE  fathers  of  the  old  California  Missions  made  a  rough 
wine  from  a  prolific  grape  which  they  introduced  from 
some  unknown  quarter,  and  which,  in  time,  became 
generally  diffused  through  the  state,  and  known  as  the  Mission 
grape.  It  is  a  very  pahxtable  table  grape,  but  is  gradually 
disappearing  from  the  markets  and  from  cultivation.  The 
similarity  of  the  climate  of  California  to  that  of  some  of  the 
great  wine-producing  countries,  the  abundant  growth  of  the 
vine,  and  its  prolific  bearing  in  the  virgin  soil,  led  the  early 
horticulturists,  and  especially  those  of  foreign  birtli,  to  a  pro- 
found belief  in  the  capacity  of  California  to  produce  good 
wine,  and  at  an  early  day  cuttings  of  all  desirable  grapes 
from  the  wine  districts  of  the  world  were  introduced  and 
propagated.  Wine  and  oil  have  in  all  ages  been  symbolical 
terms,  implying  a  special  fertility  and  charm  of  climate  in  the 
land  of  their  production,  and  prosperity,  and  happiness  in  its 
inhabitants.  The  Mission  grape  had  been  widely  planted  and 
been  found  unprofitable,  no  sufficient  market  for  it  existing  as 
a  table  grape,  and  the  wine  being  of  a  low  grade.  Gradually, 
however,  the  imported  cuttings  became  propagated,  and  wine- 
making  began  on  a  large  scale  by  men,  usually  of  European 
birth,  and  with  adequate  capital.  There  were  in  addition, 
however,  very  large  areas  of  wine  grapes  planted  by  those 
without  experience,  or  much  knowledge  of  the  capital  required, 
or  who  do  not  expect  to  make  wine,  but  to  sell  the  grapes  to 
neighboring  wine-makers. 

To  understand  the  difficulties  in  which  those  in  the  wine 
business  soon  found  themselves,  some  explanation  of  the 
processes  of  wine  making  is  required.  The  crushed  grapes 
go  into  large  vats  for  the  first  fermentation.  In  that  condition 
the  grape  juice  is  known  as  "Must."     For  red  wine  the  skins 

(517) 


518  CALIFORXTA    FRUIT    SOCIETIES. 

and  stems  are  allowed  to  remain  with  the  juice,  which  ahsorbs 
their  tannin  and  coloring  matter.  In  the  process  of  fermen- 
tation the  solid  matter  rises  to  the  top,  and  when  fermentation 
has  sufficiently  proceeded,  the  wine  is  drawn  off  from  the 
bottom  into  casks.  White  wine  is  made  from  the  juice  as  it 
comes  from  the  press,  with  all  solid  matter  eliminated.  It  is 
of  an  amber  color,  varying  somewhat  according  to  the  variety 
of  grape  used  and  the  details  of  treatment.  The  wine  in  the 
casks  must  be  kept  at  a  substantially  uniform  temperature, 
requiring  in  cold  countries  deep  and  expensive  cellars;  in 
California  substantial  brick  or  stone  buildings,  partly  below 
ground,  are  usually  found  satisfactory,  although  cellars  are 
built  in  some  places. 

It  will  be  seen,  therefore,  that  to  make  good  wine  there  is 
required,  in  addition  to  the  vineyards,  considerable  capital  to 
be  invested  in  buildings,  or  cellars,  power,  and  cooperage. 
When  the  wine  is  in  the  casks  it  requires  constant  attention 
as  the  fermentation  proceeds;  it  must  be  "racked  off"  fre- 
quently into  clean  casks,  and  the  sediment  cleaned  out; 
evaporation  goes  on  constantly  through  the  casks,  which  must 
be  kept  filled,  as  any  considerable  amount  of  air  in  the  casks 
will  spoil  the  wine.  The  attention  must  be  constant  for  two 
or  three  years,  when,  if  desired,  the  wine  can  be  bottled.  Care 
and  cleanliness  are  essential  in  every  step. 

The  celebrated  wines  of  the  world  are  made  from  old  vine- 
yards from  which  the  rank  exuberance  of  the  virgin  soil  has 
been  long  since  eliminated,  and  whose  owners  have  learned, 
by  the  experience  of  centuries,  the  most  approved  methods  of 
fertilization  and  treatment,  and  who  are  able,  by  the  cheap 
labor  of  women  and  children,  to  handle  the  grapes  with 
extreme  delicacy,  and  who  treat  the  wine  in  the  cellars  in  the 
light  of  traditions  coming  down  through  many  generations. 

It  is  not  possible,  in  a  new  country  where  labor  is  dear  and 
unskilled,  and  whose  teeming  soil  imparts  to  the  gra[)e  and 
through  it  to  the  wine,  the  varying  flavors  of  its  rankness,  to 
successfully  compete  with  the  gre.it  wines  of  the  world.  Tliese 
great  wines  will  be  produced  in  California  in  future  years,  but 
not  now.     Such  wines,  however,  cut  little  figure;  they  repre- 


THE    WINE-MAKKKS'    CORPORATION.  519 

sent  great  outlays  in  preparation,  and  great  profits,  and  are 
for  the  rich.  The  lighter  soils  and  mountain  slopes  of  Cali- 
fornia already  produce,  under  the, improved  treatment  of  later 
years,  an  abundance  of  sound,  wholesome,  and  palatable 
light  wines,  thoroughly  fit  for  any  company  and  any  table, 
but  it  is  evident  from  what  has  been  said  of  the  care  required, 
and  the  labor  and  capital  essential  to  the  making  of  good 
wine,  that  in  a  new  country  with  scant  capital,  dear  labor  and 
abounding  inexperience,  there  would  also  be  great  quantities 
of  very  poor  wine. 

In  practice,  the  best  California  wines  have  been  largely 
sold  under  foreign  labels,  thus  depriving  California  of  the 
credit  of  its  best  wines,  while  compelling  it  to  bear  the  stigma 
of  the  poor.  The  motive  for  this  is  obvious;  a  bottle  of  wine, 
which  as  domestic,  could  be  sold  at  a  good  profit  for  fifty  cents, 
with  no  extra  expense  except  the  affixing  of  a  new  label,  may 
bring,  as  imported,  a  dollar  and  a  half,  and  the  customer  be 
just  as  well  pleased  and  as  well  served.  Labels  of  all  known 
brands,  with  imitations  of  special  corks,  bottles,  or  other  pecul- 
iarities, are  kept  constantly  in  stock  in  all. cities,  at  trifling 
cost,  to  be  used  for  this  purpose. 

The  result,  therefore,  of  inadequate  capital,  and  insufficient 
knowledge  on  the  part  of  the  wine-growers,  combined  with  the 
bad  reputation  resulting  from  selling  all  the  poor  wines  under 
their  true  name,  and  most  of  the  best  wines  under  foreign 
names,  was  the  gradual  impoverishment  of  the  growers,  who, 
unable  to  treat  their  wines  properly,  or  carry  tliem  to  matu- 
rity, were  compelled  to  sell  as  fast  as  made,  to  the  wine  mer- 
chants, for  any  price  they  could  get.  For  years  this  went  on 
from  bad  to  worse,  until  in  1893  and  1894,  tlie  bulk  of  the 
light  wines  was  purchased  at  from  six  to  eight  cents  per  gallon, 
at  which  rate  an  annual  deficit  could  be  expected  with  cer- 
tainty by  all  growers.  A  majority  of  the  wine  merchants 
organized  a  corporation  known  as  the  California  Wine  Associa- 
tion, thus  practically  eliminating  tlie  competition  of  buyers, 
and  leaving  all  but  tlie  strongest  growers  helpless,  and  these 
with  no  hope  of  profit. 

Under  these  circumstances,  the  wine-growers,  like  otliers 


520  CALIFORNIA    FRUIT    SOCIETIES. 

under  similar  conditions,  turned  to  cooperation  for  relief. 
After  a  year  or  two  of  preliminary  discussiua,  meetings  were 
called  and  a  plan  of  organization  agreed  upon,  substantially, 
in  principle,  like  that  of  the  citrus  associations,  except  that 
no  local  organizations  were  provided  for.  A  central  corpora- 
tion was  to  be  formed,  which  should  contract  for  the  output  of 
its  members  for  a  term  of  years,  at  a  gradually  increasing  scale 
of  prices,  the  agreement  to  become  binding  when  contracts  for 
seventy-five  per  cent  of  the  acreage  of  vineyards  were  secured. 
This  plan  was  a  failure.  The  detail  of  visiting  and  laboring 
with  so  large  a  number  of  vineyardists,  many  of  whom  were 
in  no  financial  condition  to  make  or  keep  any  contract,  was 
exliausting  and  excessively  annoying,  but  as  the  movement 
was  led  by  the  large  growers,  there  was  no  lack  of  means  for 
expenses,  and  in  the  end,  as  it  was  claimed,  agreements  cover- 
ing the  required  seventy-five  per  cent  were  secured.  The 
proposition  that  the  proposed  corporation  should  contract  with 
its  members  at  certain  rates  had  been  based  on  a  verbal  under- 
standing with  members  of  the  California  Wine  Association 
that  it  should  take  the  wines  from  the  new  corporation  at  the 
same  rates.  When,  however,  the  written  pro])osal  came  to  be 
formally  acted  upon  by  the  California  Wine  Association,  it 
failed  of  ado[)tion,  and  the  project  had  to  be  abandoned. 

It  was  evident  to  those  who  had  conducted  the  canvass 
among  the  growers,  that  any  new  proposals  which  should 
involve  a  pro  rata  contribution  of  the  capital  necessary  to 
enable  the  growers  to  be  independent  of  the  California  Wine 
Association,  and  other  established  wine  merchants,  could  not 
be  carried  through.  But  while  there  were  perhaps  thousands 
of  vineyardists,  there  were  at  the  most  but  two  hundred  or  three 
hundred  wine-makers  equipped  with  tlie  plant  necessary  to 
produce  good  wine  on  any  commercial  scale.  These  made 
their  own  wines,  and  bought  grapes  from  their  neighbors,  and 
so  took  the  place  of  local  associations  in  other  branches  of  the 
fruit  business.  While  mostof  tliem  were  seriously  involved, 
and  some  in  distress,  they  were  yet  mostly  sensible  business 
men,  and  formed  ])racticable  units  of  organization.  If  they 
came  in  they  brought  with  them  the  vineyards  whose  grapes 
they  purchased. 


THE    WI\E-MAKKHS'    CORPORATION.  521 

A  canvass  was  tlicrefore  at  once  instituted  among  this 
class,  and,  within  a  reasonable  time,  completed  by  the  signa- 
tures of  those  controlling  more  than  the  required  seventy-five 
per  cent,  of  the  output  of  dry  wines,  and  the  "  Wine-makers' 
Corporation  "  was  then  duly  formed. 

The  essential  features  of  this  corporation  and  its  operations 
are  as  follows: — 

1.  Subscriptions  to  the  stock  of  the  corporation  according 
to  annual  product  by  all  wine-makers. 

2.  The  immediate  grading,  by  experts  appointed  by  the 
corporation,  of  all  wines  in  tlie  cellars  of  its  members,  and 
prompt  distillation  of  all  unsound  and  inferior  goods  into 
brandy. 

8.  The  purchase,  by  the  corporation,  of  all  merchantable 
stock,  at  an  agreed  price,  ninety  per  cent  payable  in  cash  as 
sold,  and  five  per  cent  to  be  applied  in  payment  of  stock 
subscriptions. 

4.  Necessary  advances  by  the  corporation,  in  advance  of 
sales  by  it,  at  usual  rates  of  interest,  upon  ail  wines  thus  turned 
over  to  it. 

5.  A  privilege  to  each  wine-maker  to  withdraw  from  the 
wine  sold  by  him  to  the  corporation,  all  wines  needed  by  him 
for  his  private  trade,  under  a  guarantee  that  they  shall  not  be 
sold  at  prices  less  than  those  fixed  b}^  the  corporation  for  wines 
of  the  same  grade. 

6.  The  lease,  by  the  corporation, of  the  buildings  and  plant 
of  each  wine-maker,  the  corporation  to  re-lease  to  the  owner, 
under  conditions  insuring  that  tlie  business  shall  be  carried 
on  in  the  manner  prescribed  by  the  corporation  for  the  general 
good. 

This  plan  is  evidently  effective  and  business  like.  It  was 
rendered  possible  by  the  fact  that  wines  being,  under  proper 
care,  non-perishable,  are  highly  available  as  security,  and  the 
officers  and  directors  of  the  corporation  being  men  of  capital 
and  business  experience,  there  was  no  trouble  in  conducting  its 
financial  operations.  It  is  more  substantial  than  the  coopera- 
tive societies  concerned  in  otlier  fruit  products  for  the  reason 
that  wines  are  non-perishable  and  more  staple  than  other  fruit 


522  CALIFORNIA    FRUIT    SOCIETIES. 

products.  It  is  an  effective  Trust  so  long  as  it  controls  the 
output. 

As  soon  as  it  became  evident  that  the  corporation  would 
from  the  first  have  ample  credit,  and  within  a  few  years  a 
large  cash  capital,  its  position  was  assured.  The  established 
wine-merchants,  with  their  wide-spread  business  connections^ 
were  an  important  factor  in  the  trade  which  there  was  no  dis- 
position to  antagonize.  The  Wine-maker's  Corporation,  own- 
ing the  wines,  and  fully  equipped  with  the  means  for  effective 
distribution,  had  yet  no  desire  to  engage  in  that  branch  of  the 
business,  preferring  to  leave  that  to  others,  so  long  as  they  as 
wine-makers  were  assured  living  rates  for  their  products.  But 
being  known  to  be  strong,  the  corporation  was  not  called  to 
exert  its  strength,  but  was  able  to  promptly  dispose  of  its 
wines  to  the  California  Wine  Association  and  others,  at  better 
rates  than  that  corporation  refused  to  give  when  they  were 
offered  practical  control.  The  prices  were  at  once  advanced  to 
living  rates,  and  the  subscribers  to  the  stock  of  the  Wine- 
maker's  Corporation,  after  paying  for  one-tenth  of  their  stock 
the  first  year,  had  coming  to  them  in  cash  far  more  than  they 
had  been  accustomed  to  receive.  The  wine  business  of  Cali- 
fornia seemed  firmly  settled  on  a  sound  financial  basis,  and 
the  Wine-maker's  Corporation  gave  more  promise  of  stability 
than  any  other  cooperative  enterprise  of  its  character.  Mean- 
time there  was  little  talk,  no  friction,  and  the  regular  channels 
of  trade  were  not  disturbed.  The  vineyardists  who  were  not 
wine-makers,  it  is  true,  liad  no  protection,  and  were  more  or 
less  at  the  mercy  of  the  wine-makers,  to  whom  they  must  sell; 
but  they  could  not  help  sharing  in  the  increased  prosperity  of 
the  business,  and  that  they  themselves  had  no  actual  contrib- 
utary  and  controlling  part  in  it,  was  due  simply  to  the  fact 
that  the  majority  wore  out  the  patience  of  the  organizers  by 
their  endless  talk,  criticism,  suspicion,  and  delay. 

No  cooperative  enterprise  of  this  kind  must  expect  plain 
sailing.  Trouble  is  sure  to  come,  the  outcome  of  which  will 
depend  partly  upon  the  circumstances  of  the  case,  and  partly 
upon  the  mental  caliber  of  the  cooperators,  which  is  quite  sure 
to  bo  fairly  represented  in  the  board  of  directors.      After  one 


THK    WIXF.-MAKERs'    CORPOKATTON.  523 

or  two  years  of  prosperous  business,  the  Wine-makers'  Corpora- 
tion became  engaged  in  a  deadly  conflict  with  the  Wine  Asso- 
ciation, which  was  its  principal,  if  not  sole,  customer.  It  is 
not  necessary  to  go  into  the  occasions  of  this  quarrel,  or  the 
details  of  its  progress.  One  cause,  whether  openly  avowed  or 
not,  was  the  desire,  common  to  all  Trusts,  whether  of  farmers 
or  others,  to  obtain  the  highest  possible  ])rices  for  their 
products.  The  Wine  Association  had  undertaken  to  purchase 
the  entire  output  of  the  Wine-makers'  Corporation  at  prices  to 
be  agreed  upon  each  year,  after  tlie  size  of  the  coming  vintage 
could  be  estimated.  There  came  a  time  when  the  prices 
demanded  by  the  wine-makers  were  higher,  in  the  opinion  of 
the  Wine  Association,  than  it  could  pay  without  loss.  In  the 
opinion  of  these  dealers,  if  they  should  take  the  wines  at  the 
price  demanded,  the  increase  of  importations  and  of  adultera- 
tion would  be  such  that  the  association  could  not  dispose  of 
the  product  so  bought  without  loss.  Apparently  this  feeling 
led  to  a  general  disposition  to  quarrels,  for  wliich  there  are 
always  occasions  when  the  disposition  exists,  and  the  result 
was  an  outbreak  resulting  in  protracted  litigation,  the  engaging 
by  the  corporation  in  marketing  upon  its  own  account,  and  a 
contest  for  the  control  of  the  crop.  While  the  wine-makers 
were  bound  to  their  own  corporation  by  five-year  contracts, 
they,  of  course,  controlled  no  grapes  except  those  of  their  own 
vineyards.  The  Wine  Association  could  easily  start  in  busi- 
ness wine-makers  in  their  own  interest,  of  whom  there  liad 
always  been  some,  and  they  did  so,  and  the  two  opposing  forces 
engaged  in  a  contest  for  the  purchase  of  the  grapes  of  the  new 
wine-making  vineyardists.  Success  in  this  was  vital  to  the 
association,  as  the  corporation  controlled  the  majority  of  the 
wine  then  in  existence,  without  which  the  association  in  a 
short  time  would  be  unable  to  supply  its  trade,  which  it  would 
therefore  lose  to  the  Wine-makers'  Corporation.  The  latter 
tliereupon  sought  by  public  meetings  to  create  such  a  feeling 
as  would  prevent  grape-growers  from  selling  to  the  wine- 
makers  of  the  association,  which  was  able,  by  reason  of  its 
larger  cash  capital,  to  offer  a  larger  immediate  cash  payment 
than  the  corporation    could   make.     Had  the  capital  of  the 


524  CALIFORNIA    FRUIT   SOCIETIES. 

associution  been  large  enough,  they  would  have  won,  if  they 
had  chosea  to  risk  it,  for  in  spite  of  the  fact  that  the  press  and 
impartial  public  sentiment  was  strongly  in  favor  of  the  cor- 
poration, it  is  unlikely  that  the  independent  growers,  who  had 
suffered  somewhat  at  the  hands  of  the  wine-makers  of  the 
corporation,  when  they  had  things  their  own  way,  would  have 
refused  substantially  better  offers  from  the  association  for  the 
purpose  of  aiding  the  corporation.  Tliey  would  have  taken 
their  chances  for  the  future.  But  the  capital  and  credit  of 
the  association,  though  large,  had  a  limit  easily  reached,  and 
the  fierce  competition  in  sales  which  then  existed  between  the 
two  bodies  had  so  reduced  the  prices  of  wine  that  bankers  were 
very  cautious  in  lending  money  upon  it.  The  administration 
of  the  estate  of  a  member  of  the  association  made  public  the 
fact  that  its  stock  had  greatly  depreciated,  and,  upon  the  whole, 
it  took  the  wise  course  of  not  making  extravagant  offers.  The 
result  was  that  the  corporation  retained  control  of  the  output, 
while  the  litigation  went  in  favor  of  the  association.  This 
afforded  the  basis  for  a  compromise,  which  at  once  restored 
both  to  prosperity.  The  price  of  wine  was  raised  to  a  fair  but 
reasonable  price,  at  which  it  freely  went  into  consumption,  and 
every  one  was  making  money  again.  Just  at  this  time  the 
contracts  of  the  wine-makers  with  their  corporation  expired, 
and  as  these  pages  go  to  press  a  canvass  is  in  progress  for  their 
renewal. 


While  in  the  foregoing  chapters  of  this  book,  I  have  not 
always  made  prominent  the  advantages  to  producers,  which 
have  immediately  followed  cooperation  in  California,  I  may 
say,  once  for  all,  that  they  have  been  substantial,  and  this, 
whether  actual  control  of  the  product  involved  was  secured  or 
not.  I  speak  of  the  completed  and  successful  societies.  The 
failures,  of  which  there  have  been  many,  have  been  necessary 
steps  in  the  progress  of  education.  I  know  of  no  one  who 
has  successfully  cooperated  who  does  not  think  that  it  has  paid. 

As  to  the  future,  it  seems  to  me  that,  in  California,  the 
prospect  of  continued  and  successful  cooperation  among  farm- 


THE    WIXE-MAKEKS'    COKPOKATIOX.  525 

ers  will  depend  upon  the  assurance  of  reasonable  reward  to 
those  competent  to  manage  cooperative  enterprises.  Until 
lately  there  has  been  no  career  open  to  capable  men  engaging 
in  cooperation,  on  any  large  scale,  except  one  of  disappoint- 
ment and  annoyance.  Capable  men  can  secure  for  themselves 
and  their  families  more  comfort  and  greater  respect  in  com- 
petitive than  in  cooperative  work,  and  consequently  seek  com- 
petitive business.  Young  enthusiasts  may  embrace  it  until 
their  illusions  are  dispelled,  and  elderly  men  nsay  dabble  in  it 
m  the  hope  to  round  out  their  lives  witli  some  useful  work, 
l>at  the  vigorous  men  of  affairs  will,  except  in  exceptional 
cases,  let  it  alone.  The  feeling  is  that  the  farmers  are  now 
paying  very  heavily  for  the  distribution  of  their  products,  as 
shown  by  the  general  prosperity  of  those  engaged  in  that  busi- 
ness on  a  large  scale.  No  such  compensation  as  is  now  paid  is 
expected,  but  reasonable  compensation  and  a  prospect  of  a 
permanent  career  is  expected.  It  is  not  considered  that  the 
farmers  are  unable  to  pay,  or  that  there  is  occasion  to  invoke, 
in  their  belialf,  that  higher  spirit  of  altruism  which  is  claimed 
and  inspired  by  the  misfortunes  of  those  who  have  only  their 
labor  to  sell.  In  default  of  this  willingness  to  pay  reasonably, 
and  above  all  things  to  sustain  heartily,  bright  young  men  are 
more  desirous  to  connect  themselves  with  the  cooperation  of 
capitalists.  I  presume  this  will  be  found  to  be  the  case  in 
farming  communities  elsewhere  in  America.  The  great  Trusts 
of  the  world  are  administered  by  the  most  capable  men,  and 
their  rewards  are  magnificent.  The  popular  antagonism  to  the 
Trust  is  almost  never  directed  to  the  personal  management, 
who,  according  to  their  personal  qualities,  enjoy  not  only  the 
comforts  attainable  by  a  large  income,  but  the  respect  and  the 
deference  of  those  with  whom  the}^  come  in  personal  contact. 
Few  who  could  be  responsible  servants  of  a  cooperative 
society  of  capitalists  would  be  inclined  to  accept  the  service 
of  a  cooperative  society  of  farmers.  But  farmers  can  get 
service  of  this  grade  whenever  they  are  ready  to  reward  it  with 
moderate  money  payment  and  a  large  measure  of  honor. 

This  condition  can  only  be  brought  about  as  to  cooperative 
enterprises  of  producers  when  large  masses  of  men  realize  that 


526  CALIFOKNIA    FRUIT   SOCIETIES. 

they  have  need  of  the  man  of  brains  and  power,  while  he  has 
no  need  of  them,  and  when  tlie  machinery  has  been  created 
whereby  the  capable  man  may  be  surely  found,  and  by  proper 
steps  advanced  to  the  conduct  of  affairs  with  the  same  certainty 
of  adequate  compensation  and  security  in  his  position  that 
he  finds  in  competitive  business. 

One  would  indeed  be  foolish  to  attempt  to  predict  the  final 
resultants  of  existing  social  forces,  and  much  more  to  prophesy 
as  to  possible  changes  in  the  nature  and  direction  of  the  forces 
themselves  which  may  grow  out  of  the  evolution  of  human 
nature;  but  from  observed  facts  we  may  with  confidence  infer 
some  things  at  least  as  to  the  immediate  future.  As  frequently 
intimated  in  these  pages  it  does  not  seem  to  me  improb- 
able that  the  affairs  of  mankind  will  ultimately  be  trans- 
acted cooperatively.  As  has  been  frequently  pointed  out, 
great  portions  of  this  business  is  now  so  transacted,  and 
the  fact  that  cooperation  began  among  the  ablest  for  their  per- 
sonal enrichment  as  against  the  rest  of  mankind,  is  good  evi- 
dence of  its  wisdom  and  its  possibility.  It  is  only  necessary  that 
John  Smith  and  John  Jones  should  become  as  wise  and  strong 
as  Jay  Gould  and  Cornelius  Vanderbilt  to  make  cooperation 
as  effective  among  tl)e  Smiths  and  Joneses  as  it  is  now  among 
the  railroad  magnates;  and  it  is  only  necessary  that  there 
should  be  reasonable  wisdom  and  ability  in  the  masses,  to 
produce  reasonably  satisfactory  results. 

At  present,  possibly,  that  reasonable  abilit}^  may  not  gen- 
erally exist.  It  certainly  seems  to  exist  in  some  places,  and  be 
absent  from  others.  Mankind,  upon  the  whole,  does  not  seem 
to  be  very  wise,  and  yet  it  is  true  that  the  general  consensus  of 
opinion  in  civilized  countries  agrees  very  well  with  the 
doctrines  of  philosophy.  The  humanity  which  poets  exalt^ 
and  enthusiasts  die  for  sometimes,  seems  to  exist  largely  in 
imagination.  Whoever  deals  in  the  concrete  with  the  atoms 
of  humanity  finds  in  them  much  that  does  not  resemble  the 
ideal.  Here  and  there  a  pure  and  lofty  soul  is  found  buried 
under  the  feet  of  the  struggling  masses,  and  is  held  up  by  the 
poet  as  the  exemplar  of  humanity.  He  is  not.  At  the  same 
time,  when  we  remember  that  descendants  of  the  wily  savage, 


THE    WINE-MAKKKS'    COKI'UKATIUN.  .')27 

whose  chief  virtues  were  deceit  and  treachery,  have  in  the 
course  of  generations  learned  to  confide  iu  others,  and  com- 
bine in  Trusts,  against  the  world,  and  that  some  of  our  ances- 
tors of  only  three  centuries  ago  doubtless  witnessed  with 
approval  the  burning  of  martyrs,  it  is  perhaps  not  too  much 
to  expect  that  a  few  centuries  more  may  fit  the  world  for 
cooperation.  The  changes  of  social  force,  in  nature  and  direc- 
tion necessary  to  make  universal  cooperation  possible,  do  not 
seem  to  me  greater  than  those  that  have  taken  place  since  the 
dawn  of  history.* 


*  My  personal  experience  in  cooperative  work  among  farmers  has  possessed, 
for  myself,  a  sort  of  grim  humor,  and  may  be  entertaining  to  others.  It  has,  at 
any  rate,  a  certain  educational  value,  and  as  I  am  in  a  position  to  write  with 
entire  frankness,  I  give  the  substance  of  it  for  what  it  is  worth,  reminding  my 
readers  that  this  was  not  a  case  of  cooperation  among  or  for  absolutely  poor 
people,  but  among  those  quite  able  to  protect  their  own  interests  if  they 
cooperated  as  they  said  they  wished  to.  For  many  years  I  had  been  in  charge, 
upon. the  Pacific  Coast,  of  certain  eastern  interests  which,  in  due  time,  devel- 
oped into  a  Trust.  The  owners  of  the  business  never  struck  me  as  wicked  men, 
but  simply  as  ordinary  good  citizens,  wishing,  like  honest  farmers  and  work- 
men, to  set  the  highest  possible  price  for  their  product,  and  somehow  compel 
people  to  pay  it.  They  were  kindly  men,  prominent  at  the  missionary  box, 
and  elsewise  in  good  words  and  works,  but  never,  in  any  conference  to  which 
I  was  admitted,  was  the  public  welfare  made  the  basis  on  which  prices  were 
fixed.  I  had  no  instructions  to  consider  the  public  weal,  and  never  did,  but 
got  all  I  could,  receiving  therein  the  cordial  support  of  my  principals,  with 
complimentary  telegrams  upon  the  happening  of  a  lucky  stroke  of  business. 
In  the  meantime,  in  my  little  personal  world,  whose  attitude  towards  one  does 
so  much  towards  making  life  cheerful  or  otherwise,  I  had  evidence  of  general 
good-will,  with  some  special  esteem  and  respect  as  for  one  concerned  with  a 
Monopoly  of  some  consequence  for  those  days.  I  never  heard  of  an  unpleasant 
word  said  about  me  by  anybody,  and  I  suppose  I  had  not  an  enemy  in  the 
world.     Life  was  very  rosy. 

"When  I  left  that  sinful  employment,  and  was  soon  after  born  into  the  king- 
dom of  cooperation,  I  cheerfully  accepted  the  tasks  which  were  set  me, 
and  discharged  them  with  the  same  zeal  with  which,  in  my  unregenerate 
days,  I  had  served  the  arch  enemy.  As  unexpected  obstacles  arose,  inbred 
contrariness  impelled  me  to  strive  to  surmount  them,  in  which  endeavor  I 
worked  harder  than  ever  before  in  my  life,  or  than  I  ever  intend  to  again. 
The  aggregate  wealth  of  the  people  who  had  asked  me  to  serve  them  was  far 
greater  than  that  of  my  former  employers,  while  I  was  not  rich,  and  in  fact, 
although  I  did  not  know  it  at  the  time,  was  quite  poor.  There  was  therefore  no 
reason  why  they  should  not  pay  or  I  should  not  receive  compensation  for  what 


528  CALIFORNIA    FRUIT    SOCIETIES. 

I  had  been  asked  to  do,  and  I  did  take  what  I  thought  I  needed,  which  was 
about  one  quarter  of  what  a  self-respecting  Monopoly  would  have  expected  to 
pay  for  similar  eflbrt.  I  never  thought  myself  incompetent  for  what  I  had 
undertaken,  and  supposed  myself  to  be  donating  the  greater  part  of  the  value 
of  what  I  did.  But  the  humor  of  the  situation  appeared  in  the  attitude  of  my 
employers,  the  People,  and  of  the  outside  world.  Having  always  been  respected 
as  the  emissary  of  a  Monopoly,  I  anticipated  greater  esteem  as  the  representa- 
tive of  the  People.  Having  been  accustomed  to  hear  nice  things  said  when  I 
did  good  work  for  an  evil  cause,  I  expected  still  prettier  compliments  for  harder 
work  done  in  a  good  cause.  I  got  none  of  them.  The  mass  of  my  employers 
profoundly  distrusted  me,  and  the  world  at  large  thought  me  engaged  in  very 
trifling  business.  There  was  a  distinct  lowering  of  social  standing,  which  is 
never  agreeable.  When  my  motives  were  attacked  by  those  opposed  to 
cooperation,  no  employer,  that  I  ever  heard  of,  defended  me,  and  many  repeated 
and  enlarged  upon  the  evil  stories.  I  had  left  business  because  I  had  become  too 
lazy  to  woTk  hard,  and  wild  horses  could  not  have  dragged  me  back  into  the 
details  of  affairs,  but  I  became  satisfied  that  the  opinion  was  well-nigh  univer- 
sal that  I  was  exploiting  the  poor  farmers  for  a  permanent  job  at  a  "fat  salary, " 
not  otherwise  attainable,  and  was  accompanied  by  a  grim  determination  that 
I  should  never  get  it.  I  have  sought  in  a  number  of  cases  to  be  actively  help- 
ful to  some  class,  I  being  one  of  the  class,  but  never,  I  think,  without  having 
my  motives  impugned,  lies  told  about  me,  and  raising  a  crop  of  enemies  T^thin 
the  class  which  I  was  seeking  to  benefit.  At  first,  of  course,  this  was  very 
annoying,  but  later  the  humor  of  the  situation  prevailed,  and  I  amused  myself 
with  trying  to  understand  why  people  should  like  a  man  so  long  as  he  was 
exploiting  them,  but  hate  him  as  soon  as  he  began  to  try  to  help  them  exploit 
other  folks.     But  I  never  could. 

Of  late  years  I  am  cooperating  with  everybody  who  wishes  to  cooperate, 
but  extending  no  invitations  of  the  kind,  and  otherwise  strictly  attending  to  my 
own  business.  As  a  result  of  this  process  my  own  little  afi"airs  are  prospering 
fairly,  and  I  seem  to  myself  to  be  gradually  regaining  the  esteem  of  mankind; 
so  much  so,  in  fact,  that  I  am  not  without  hope  that  I  shall  some  time  be 
thought  of  as  kindly  as  when  I  was  serving  a  Monopoly.  So  far  as  a  restless 
soul  impels  me  to  meddle  with  other  people's  business,  I  find  most  enjoyment, 
and  the  prospect  of  most  usefulness,  in  promoting  useful  aims  by  whose  accom- 
plishment I  can  not  possibly  benefit,  and  in  doing  so  at  my  own  expense.  I 
don't  like  the  Public  as  a  master  and  will  not  work  for  it  any  more.  I  have 
said  elsewhere  that  I  do  not  think  altruism  a  proper  basis  for  cooperative  busi- 
ness, but  for  myself  I  am  too  selfish  to  engage  in  it  from  any  other  motive.  I 
will  not  surrender  my  peace  of  mind. 

While  I  have  made  the  foregoing  statement  hoping  that  it  may  aid  in 
securing  for  faithful  servants  of  cooperating  fiirmers  more  considerate  treat- 
ment than  they  sometimes  receive,  I  should  be  very  ungrateful,  and  do  injustice 
to  many,  did  I  not  in  the  same  breath  recognize  the  cordial  support  and  endur- 
ing friendships  which  came  to  me,  and  have  come  to  others,  as  the  result  of 
labor  in  cooperative  work  among  farmers.  There  was  nnicli  of  this,  and  yet, 
upon  the  whole,  the  general  impression  which  I  received  is  as  above  stated. 


THK    wink-makers'    CORPORATION.  529 

It  is  also  proper  to  say  that  not  all  of  our  coopcrators  are  so  weak-minded  as 
myself.  Far  more  evil  than  was  ever  said  about  me  has  been  said  for  years 
against  better  men  than  I,  who  go  steadily  on  with  their  work,  and  in  time  have 
a  following  who  stand  by  them  and  make  them  comfortable.  This,  I  suppose, 
will  in  time  happen  to  every  one  who  does  his  duty  and  is  patient.  There  are 
many  such  men  in  California,  without  whose  aid  cooperative  work  could  rir)t 
be  carried  on.     I  simply  do  not  happen  to  be  patient. 

After  all  there  is  nothing  tragic  about  cooperative  work  among  farmers.  It 
is  cooperation  among  the  fairly  well  to  do.  It  does  not  particularly  appeal  to 
the  sympathies,  nor  call  for  much  self-denial  that  one  does  not  feel  inclined  to. 
It  is  cooperation  among  the  really  suffering  that  stirs  the  blood.  It  is  when 
one  thinks  of  such  men  as  Mitchell  in  England,  and  Kaiffiesen  in  Germany, 
and  men  like  them,  that  he  raises  his  hat  and  is  silent  a  moment. 


34 


APPENDIX 


The  body  of  this  volume  is  based  mainly  upon  the  experi- 
ence and  observation  of  the  author,  with  little  or  no  reference 
to  the  experiences  of  others,  and  no  reliance  whatever  upon 
"authorities."  I  wished  my  own  conclusions  to  go  for  what 
they  may  be  worth.  Tlie  appendix  is  intended  to  supplement 
my  own  observations  with  the  experience  and  observation  of 
others  upon  some  of  the  same  subjects,  to  illustrate  more  freely 
some  topics  w^hicli  were  necessarily  treated  but  briefly  in  the 
text,  to  indicate  to  general  readers  not  having  access  to  large 
libraries,  the  sources  from  which,  at  least  expense,  they  may 
inform  themselves  further  upon  any  of  the  subjects  here  treated 
in  which  they  may  be  specially  interested,  and  to  serve,  in 
some  measure,  as  a  statistical  hand-book.  As  will  be  noted, 
however,  I  have  not  hesitated  to  introduce  discussion  in  con- 
nection with  any  subject  upon  which  I  thought  discussion  or 
explanation  would  be  helpful,  in  which  respect  this  differs 
from   the  usual   conception  of  an  "appendix." 

All  statistical  and  other  matter  not  original  has  been  cred- 
ited to  original  sources,  when  known,  and  otherwise  to  the 
publications  in  which  it  was  found.  The  diagrams  illustrat- 
ing the  subject  of  the  Currency  have,  unless  otherwise  speci- 
fied, been  prepared  for  this  volume  from  data  familiar  to  all 
students  of  the  subject.  E.  F.  A. 


(531 


Appendix  A, 


ORGANIZATION     OF     U.    S.    DEPARTMENT    OF     AGRICULTURE, 

AND    LEGISLATION    IN    AID    OF    AGRICULTURAL 

COLLEGES    AND   EXPERIMENT 

STATIONS. 


[The  descriptive  matter  in  Appendix  A  is  from  a  Department  publication. 


LAW  CREATING  THE  DEPARTMENT  OF  AGRICULTURE. 

The  Department  of  Agriculture  was  established  by  an  act  of  Congress  ap- 
proved by  President  Lincoln,  May  15,  1862.  The  full  text  of  the  act  is  as 
follows: 

AN  ACT  to  establish  a  Department  of  Agriculture. 

Be  it  enacted  by  the  Senate  and  House  of  Representatives  of  the  United  States 
of  America  in  Congress  assembled,  That  there  is  hereby  established  at  the  seat 
of  the  Government  of  the  United  States  a  Department  of  Agriculture,  the  gen- 
eral designs  and  duties  of  which  shall  be  to  acquire  and  to  ditl'use  aniong  the 
people  of  the  United  States  useful  information  on  subjects  connected  with  agri- 
culture in  the  most  general  and  comprehensive  sense  of  that  word,  and  to  pro- 
cure, propagate,  and  distribute  among  the  people  new  and  valuable  seeds  and 
plants. 

Sec.  2.  And  be  it  farther  enacted,  That  there  shall  be  appointed  by  the 
President,  by  and  with  the  advice  and  consent  of  the  Senate,  a  "  Commissioner 
of  Agriculture,"  who  shall  be  the  chief  executive  officer  of  the  Department 
of  Agriculture',  who  shall  hold  his  office  by  a  tenure  similar  to  that  of  other 
civil  officers  appointed  by  the  President,  and  who  shall  receive  for  his  compen- 
sation a  salary  of  three  thousand  dollars  per  annum. 

Sec.  3.  And  be  it  further  enacted,  That  it  shall  be  the  duty  of  the  Commis- 
sioner of  Agriculture  to  acquire  and  preserve  in  his  department  all  infornnition 
concerning  agriculture  which  he  can  obtain  by  means  of  books  and  correspond- 
ence and  %y  practical  and  scientific  experiments  (accurate  records  of  which 
experiments  shall  be  kept  in  his  office^  by  the  collection  of  statistics,  and  by 
any  other  appropriate  moans  within  his  power;  to  collect,  as  he  may  be  able, 
new  and  valuable  seeds  and  plants;  to  test  by  cultivation  the  value  of  such  of 
them  as  may  require  such  tests;  to  propagate  such  as  may  bo  worthy  of  propa- 
gation, and" to  distribute  them  among  agriculturists  Ho  shall  annually  make 
a  general  report  in  writing  of  his  acts  to  the  Presidentand  to  Congress,  in 
which  he  may  recommend  the  publication  of  papers  forming  parts  of  or  accom- 
panying his  report,  which  report  shall  also  contain  an  account  of  all  moneys 
received  and  expended  by  him.  He  shall  also  make  special  reports  on  partic- 
ular subjects  whenever  required  to  do  so  by  the  President  or  either  House  of 
Congress,  or  when  he  shall  think  the  subject  in  his  charge  requires  it.     He  shall 

(  538 ) 


534  APPENDIX. 

receive  and  have  charge  of  all  the  property  of  the  agricultural  division  of  the 
Patent  Office  in  the  Department  of  the  Interior,  including  the  fixtures  and 
property  of  the  propagating  garden.  He  shall  direct  and  superintend  the  ex- 
penditure of  all  money  appropriated  by  Congress  to  the  department  and  render 
accounts  thereof,  and  also  of  all  money  heretofore  appropriated  for  agriculture 
and  remaining  unexpended.  And  said  commissioner  may  send  and  receive 
through  the  mails,  free  of  charge,  all  communications  and  other  matter  pertain- 
ing to  the  business  of  his  department,  not  exceeding  in  weight  32  ounces. 

Sec.  4.  And  be  it  fiirther  enacted,  That  the  Commissioner  of  Agriculture 
shall  appoint  a  chief  clerk,  with  a  salary  of  two  thousand  dollars,  who  in  all 
cases  during  the  necessary  absence  of  the  Commissioner,  or  when  the  said  prin- 
cipal office  shall  become  vacant,  shall  perform  the  duties  of  Commissioner,  and 
he  shall  appoint  such  other  employees  as  Congress  may  from  time  to  time  pro- 
vide, with  salaries  corresponding  to  the  salaries  of  similar  officers  in  other 
departments  of  the  government;  and  he  shall,  as  Congress  may  from  time  to 
time  provide,  employ  other  persons,  for  such  time  as  their  services  may  be 
needed,  including  chemists,  botanists,  entomologists,  and  other  persons  skilled 
in  the  natural  sciences  pertaining  to  agriculture.  And  the  said  Commissioner, 
and  every  other  person  to  be  appointed  in  the  said  department,  shall,  before  he 
enters  upon  the  duties  of  his  office  or  appointment,  make  oath  or  affirmation 
truly  and  faithfully  to  execute  the  trust  committed  to  him.  And  the  said  Com- 
missioner and  the  chief  clerk  shall  also,  before  entering  upon  their  duties,  sev- 
erally give  bonds  with  sureties  to  the  Treasurer  of  the  United  States,  the  former 
in  the  sum  often  thousand  dollars  and  the  latter  in  the  sum  of  five  thousand 
dollars,  conditional  to  render  a  true  and  faithful  account  to  him  or  his  successor 
in  office  quarter-yearly  accounts  of  all  moneys  which  shall  be  by  them  received 
by  virtue  of  the  said  office,  with  sureties  to  be  approved  as  sufficient  by  the 
Solicitor  of  the  Treasury;  which  bonds  shall  be  filed  in  the  office  of  the  First 
Comptroller  of  the  Treasury,  to  be  by  him  put  in  suit  upon  any  breach  of  the 
conditions  thereof. 

Approved  May  15,  1862. 

CHANGE    IN    RANK    OF    THE    DEPARTMENT. 

The  department  was  made  an  executive  office  of  the  first  rank  under  the  law 
approved  by  President  Cleveland  February  9,  1889.  By  that  act  the  title  of 
the  head  of  the  department  was  changed  from  Commissioner  to  Secretary,  and 
he  became  a  member  of  the  President's  cabinet. 

AN  ACT  to  enlarge  the  powers  and  duties  of  the  Department  of  Agriculture  and  to  create  an 
Executive  Department  to  be  known  as  the  Department  of  Agriculture. 

Be  it  enacted  by  the  Senate  and  House  of  Representatives  of  the  United  States 
of  America  in  Com/ress  assembled.  That  the  Department  of  Agriculture  be  an 
Executive  Department  under  the  supervision  and  control  of  the  Secretary  of 
Agriculture,  who  shall  be  appointed  by  the  President,  by  and  with  the  advise 
and  consent  of  the  Senate;  and  section  one  hundred  and  fifty-eight  of  the 
Kevised  Statutes  is  hereby  ainciidcd  to  include  such  department,  and  the  provis- 
ions of  title  four  of  the  itcvisid  St:ilutes,  including  all  amendments  thereto,  are 
hereby  made  applicable  to  s.iid  dciiartment. 

Sko.  2.  That  there  shall  be  in  said  department  an  Assistant  Secretary  of 
Agriculture,  to  be  appointed  by  the  President,  liy  and  with  the  advise  and  con- 
sent of  the  Senate,  who  shall  perform  such  duties  as  may  be  required  by  law  or 
prescribed  by  the  Secretary. 

Sh:(;.  3.  That  the  Secretary  of  Agriculture  shall  receive  the  same  salary  as 
is  paid  to  the  Secretary  of  each  of  the  Executive  Dopartmeiits,  and  tln^  salary  dT 
the  Assistant  Secretary  of  Agriculture  shall  be  the  same  as  that  now  paid  to  the 
First  Assistant  Secretary  of  the  Department  of  the  Interior. 


APPENDIX.  535 

Sec.  4.  That  all  laws  and  parts  of  laws  relating  to  tho  Department  of  Agri- 
culture now  in  existence,  as  far  as  the  same  are  applicable  and  not  in  conflict 
with  this  act,  and  only  so  far,  are  continued  in  full  force  and  efl'ect. 

Approved,  February  9,  1889. 

Several  other  changes  have  been  made  in  the  law,  including  an  amendment 
which  repeals  the  requirement  that  the  Commissioner  (Secretary)  and  chief 
clerk  give  bond.  Neither  is  now  charged  with  any  government  property  or 
money. 

BUREAUS,    DIVISIONS,    AND    OFFICES. 

The  bureaus,  offices,  and  divisions  of  the  department  as  now  organized  are 
as  follows: 

THE   WEATHER  BUREAU. 

The  "Weather  Bureau  had  its  origin  in  the  publication  by  the  department, 
beginning  in  1863,  of  meteorological  data  gathered  by  the  Smithsonian  Institu- 
tion, and  in  the  recommendation  by  Commissioner  Newton,  the  First  Com- 
missioner of  Agriculture,  that  daily  weather  reports  by  telegraph,  under  the 
direction  of  the  government,  be  distributed  to  the  country.  This  service  was 
authorized  by  an  act  of  Congress  of  February  4,  1870,  and  was  conducted  by 
the  chief  signal  officer  of  the  army  for  twenty  years.  By  the  act  of  October 
1,  1890,  the  Weather  Bureau  as  such  was  officially  recognized,  and  was  trans- 
ferred to  the  Department  of  Agriculture,  the  general  details  of  its  organization 
being  defined  in  that  act.     On  July  1,  1891,  the  actual  transfer  took  place. 

The  duties  of  the  "Weather  Bureau  are  the  forecasting  of  the  weather,  issue 
of  storm  warnings,  display  of  weather  and  flood  signals  for  the  benefit  of  agricul- 
ture, commerce,  and  navigation;  the  gauging  and  reporting  of  rivers,  the  main- 
tenance and  operation  of  seacoast  telegraph  lines,  and  the  collection  and  trans- 
mission of  marine  intelligence  for  the  benefit  of  commerce  and  navigation;  the 
reporting  of  temperature  and  rainfall  conditions  for  the  cotton,  sugar,  rice,  and 
other  interests;  the  display  of  frost  and  cold-wave  signals;  the  distribution  of 
meteorological  informsition  in  the  interests  of  agriculture  and  commerce,  and 
the  taking  of  such  meteorological  observations  as  may  be  necessary  to  establish 
and  record  the  climatic  conditions  of  the  United  States,  or  as  are  essential  to  the 
proper  execution  of  the  foregoing  duties. 

The  Bureau  now  has  150  fully-equipped  meteorological  stations;  258  stations 
specially  equipped  for  the  display  of  danger  warnings  to  mariners;  261  stations 
for  the  taking  of  telegraphic  reports  of  temperature  and  rainfall  in  the  growing 
fields,  and  over  3,000  stations  where  voluntary  observers  make  records  of  tem- 
perature and  rainfall  with  standard  instruments. 

BUREAU  OF  ANIMAL  INDUSTRY. 

The  Bureau  of  Animal  Industry,  established  in  1884,  now  comprises  sub- 
divisions as  follows :  Inspection  division,  miscellaneous  division,  pathological 
division,  biochemic  division,  zoological  laboratory,  dairy  division,  experiment 
station.  Its  duties  are  to  make  investigations  as  to  the  existence  of  contagious 
pleuro-pneumonia,  and  other  dangerous  communicable  diseases  of  live  stock; 
to  make  original  investigations  as  to  the  nature  and  prevention  of  such  diseases, 
and  to  superintend  measures  for  their  extirpation;  and  to  report  on  the  condition 
and  means  of  improving  the  animal  industries  of  the  country.  The  Bureau  also 
has  charge  of  the  inspection  of  import  and  export  animals,  of  the  inspection  of 
vessels  for  the  transportation  of  export  animals,  and  of  the  quarantine  stations 
for  imported  neat  cattle;  supervises  the  interstate  movement  of  cattle;  and 
inspects  live  stock  and  their  products  slaughtered  for  food  consumption. 


536  APPENDIX. 

DIVISION  OF  GARDENS  AND  GROUNDS. 

The  propagating  garden,  started  in  1858,  was  turned  over  by  the  Commis- 
sioner of  Patents  to  the  Department  of  Agriculture  shortly  after  the  creation  of 
the  department,  in  May,  1862,  and  the  Division  of  Gardens  and  Grounds  was 
organized  as  an  experimental  garden  in  September,  1862.  The  superintendent 
is  charged  with  the  care  of  keeping  the  lawns  and  other  ornamentations  of  the 
park,  and  with  all  duties  connected  with  the  introduction  and  propagation  of 
desirable  economic  plants,  and  their  dissemination. in  suitable  climates  through- 
out the  States. 

DIVISION  OF  CHEMISTRY. 

The  Division  of  Chemistry,  established  in  1862,  makes  investigations  of  the 
methods  proposed  for  the  analysis  of  soils,  fertilizers,  and  agricultural  products 
and  such  analyses  as  pertain  in  general  to  the  interests  of  agriculture.  It  also 
conducts  researches  on  all  subjects  in  which  chemistry  and  agriculture  are  con- 
joined. The  study  of  the  composition  of  human  foods  and  their  adulterations 
is  one  of  the  chief  functions  of  this  division.  It  can  not  undertake  the 
analyses  of  articles  of  a  miscellaneous  nature,  but  application  for  such  analyses 
should  be  made  to  the  directors  of  agricultural  experiment  stations  of  the 
different  states.  The  division  does  not  make  assays  of  ores  nor  analyses  of 
minerals,  except  when  related  to  general  agricultural  interests,  nor  analyses 
of  water. 

DIVISION  OF  ENTOMOLOGY. 

The  Division  of  Entomology,  organized  in  1863,  conducts  investigations  con- 
cerning injurious  and  beneficial  insects;  disseminates  information  regarding 
the  results  of  these  investigations  and  the  best  remedies  to  be  used  against 
injurious  insects,  by  means  of  correspondence,  circulars,  bulletins,  and  reports; 
prepares  specimens  for  illustrative  and  museum  purposes;  and  in  general  acts 
as  a  bureau  of  information  on  all  matters  relating  to  economic  entomology. 

DIVISION  OF  STATISTICS. 

The  Division  of  Statistics,  established  in  1863,  collects  information  as  to  the 
condition,  prospects,  and  harvests  of  the  principal  crops,  and  of  the  numbers 
and  status  of  farm  animals  through  a  corps  of  country  correspondents,  and 
with  the  aid  of  a  supplementary  organization  under  the  direction  of  State 
Agents.  It  obtains  similar  information  from  European  countries  monthly 
through  the  deputy  consul-general  at  London,  assisted  by  consular,  agricultural, 
and  commercial  authorities.  It  records  and  tabulates  and  coordinates  statistics 
of  agricultural  production,  distribution,  and  consumption,  the  authorized  data 
of  governments,  institutes,  societies,  boards  of  trade,  and  individual  experts; 
and  writes,  edits,  and  publishes  a  monthly  bulletin  for  the  use  of  editors  and 
writers,  and  for  the  information  of  producers  and  consumers,  and  for  their 
protection  against  combination  and  extortion  in  the  handling  of  the  products 
of  agriculture. 

DIVISION  OF  BOTANY. 

The  Division  of  Botany  was  established  in  March,  1869.  It  maintained  the 
United  States  National  Herbarium  until  July  1,  1896,  when  that  work  was 
transferred  to  the  Smithsonian  Institution.  The  chief  of  the  division,  how- 
ever, continues  to  have  charge  and  the  specimens  are  used  by  his  assistants. 
The  division  now  publishes  information  of  the  treatment  of  weeds,  experiments 
with  poisonous  and  medicinal  plants,  tests  seeds  with  a  view  to  their  increased 
purity  and  commercial  value,  and  investigates  other  questions  of  economic 
botany. 


APPENDIX.  537 

DIVISIONS  OF  ACCOUNT  AND  DISBURSEMENTS. 

The  Division  of  Accounts  and  Disbursements,  established  July  1,  1880, 
audits  and  pavs  all  accounts  and  adjusts  claims  against  the  department;  decides 
questions  involving  the  expenditure  of  public  funds;  prepares  advertisements, 
schedules,  contracts  for  annual  supplies,  leases,  and  agreements;  issues  requisi- 
tions for  the  purchase  of  supplies,  requests  for  passenger  and  freight  transpor- 
tation; prepares  the  annual  estimates  of  appropriations,  and  attends  to  all  other 
business  relating  to  the  financial  interests  of  the  department. 

DIVISION  OF  FORESTRY. 

The  Division  of  Forestry,  organized  by  order  of  the  Commissioner  m  1881, 
and  reorganized  by  Congress  as  a  division  in  1886,  is  occupied  with  experi- 
ments, investigations,  and  reports  dealing  with  the  subject  of  forestry,  and 
with  the  dissemination  of  information  upon  forestry  matters. 

DIVISION  OF  BIOLOGICAL  SURVEY. 

The  Division  of  Biological  Survey  (established  as  the  Division  of  Ornithology 
and  Mammalogy  in  1886)  studies  the  distribution  of  animals  and  plants,  and 
maps  the  natural  life  zones  of  the  country;  it  also  investigates  the  economic 
relations  of  birds  and  mammals,  and  recommends  measures  for  the  preserva- 
tion of  beneficial  and  the  destruction  of  injurious  species. 

DIVISION  OF  POMOLOGY. 

The  Division  of  Pomology,  established  in  1886,  collects  and  distributes  infor- 
mation in  regard  to  the  fruit  interests  of  the  United  States,  investigates  the 
habits  and  peculiar  qualities  of  fruits,  their  adaptability  to  various  soils  and 
climates,  and  conditions  of  culture,  and  introduces  new  and  untried  fruits  from 
foreign  countries. 

DIVISION  OF  VEGETABLE  PHYSIOLOGY  AND^ PATHOLOGY. 

This  division  was  originally  established  in  1886  as  a  section  of  mycology  in 
the  Division  of  Botany  under  F.  Lamson-Scribner;  the  following  year  it  was 
changed  to  a  section  of  vegetable  pathology,  and  in  1891  became  a  separate 
division.  In  1895  the  scope  of  its  work  "was  enlarged  and  name  altered  to 
Division  of  Vegetable  Physiology  and  Pathology. 

The  division  has  for  its  object  a  study  of  normal  and  abnormal  life  processes 
of  plants.  It  seeks  by  means  of  both  field  and  laboratory  investigations  in 
plant  physiologv,  plant  breeding  and  selection,  and  the  morphology  and  classi- 
fication of  fungi,  to  determine  the  causes  and  methods,  of  prevention  of  plant 
diseases,  the  amelioration  of  economic  plants,  and  rational  methods  of  growing 
commercial  crops. 

OFFICE  OF  EXPERIMENT  STATIONS. 

The  Office  of  Experiment  Stations,  established  in  1888,  represents  the  Depart- 
ment in  its  relation  to  the  experiment  stations,  which  are  now  in  operation  in 
all  the  States  and  Territories.  It  seeks  to  promote  the  interests  of  agricultural 
education  and  investigations  throughout  the  United  States.  It  collects  and 
disseminates  general  information  regarding  the  colleges  and  stations,  and  pub- 
lishes accounts  of  agricultural  investigations  at  home  and  abroad.  It  also 
indicates  lines  of  inquiry,  aids  in  the  conduct  of  cooperative  experiments, 
reports  upon  the  expenditures  and  work  of  the  stations,  and  in  general 
furnishes  them  with  such  advice  and  assistance  as  will  best  promote  the  pur- 
poses for  which  they  were  established.  It  is  also  charged  with  the  investigation 
of  the  nutritive  value  and  economy  of  human  food. 


538  APPENDIX. 

OFFICE  OF  FIBER  INVESTIGATIONS. 

Fiber  investigations  were  begun  in  the  Division  of  Statistics  in  1889,  and  in 
1890  the  Office  of  Fiber  Investigations  was  established.  It  collects  and  dis- 
seminates information  regarding  the  cultivation  of  textile  plants,  directs 
experiments  in  the  culture  of  new  and  hitherto  unused  plants,  purchases  seed 
and  plants  for  limited  distribution  for  experimental  purposes,  and  investigates 
the  merit  of  new  machines  and  processes,  for  extracting  the  fiber  and  preparing 
it  for  manufacture. 

DIVISION  OF  PUBLICATIONS. 

The  Division  of  Publications  was  establi.shed  in  1889  as  a  section  of  the 
Division  of  Statistics,  which  had  originally  been  charged  with  the  work  of 
editing  the  department  reports.  In  1890  it  was  organized  and  separately 
appropriated  for  as  the  Division  of  Records  and  Editing,  becoming  the  Divi- 
sion of  Publications  in  1895.  This  division  has  entire  supervision  of  the 
editing,  printing,  and  publishing  of  the  department,  and  the  distribution  of 
all  publications,  being  especially  charged,  furthermore,  with  the  preparation, 
publication,  and  distribution  of  Farmers'  Bulletins.  The  division  issues 
advance  notices  and  a  monthly  list  of  publications,  and  prepares  for  publica- 
tion any  information  of  special  interest  to  agriculturists. 

OFFICE  OF  ROAD   INQUIRF. 

The  Office  of  Koad  Inquiry,  established  in  1893,  collects  information  con- 
cerning the  system  of  road  management  throughout  the  United  States,  conducts 
investigations  into  methods  of  road  making,  directs  the  building  of  sample 
roads  at  the  agricultural  colleges  and  experiment  stations,  and  prepares  publi- 
cations on  the  subject  of  roads  and  road  laws. 

DIVISION  OF  AGROSTOLOGY. 

The  Division  of  Agrostology,  formerly  in  the  Division  of  Botany,  was 
established  as  an  independent  division  July  1,  1895,  under  the  present  chief, 
F.  Lamson-Scribner.  It  is  charged  with  the  investigations  of  the  natural 
history,  geographical  distribution,  and  uses  of  grasses  and  forage  plants,  their 
adaptation  to  special  soils  and  climates,  the  introduction  of  promising  native 
and  foreign  kinds  into  cultivation,  and  the  preparation  of  publications  and 
correspondence  relative  to  these  plants. 

DIVISION  OF  SOILS. 

The  Division  of  Soils  (formerly  Division  of  Agricultural  Soils  in  the 
Weather  Bureau)  was  establi-shed  as  an  independent  division  of  the  Depart- 
ment in  1894.  It  has  for  its  object  the  investigation  of  the  texture  and  other 
physical  properties  of  soils  and  their  relation  to  crop  production. 

SECTION  OF  FOREIGN  MARKETS. 

The  Section  of  Foreign  Markets  was  instituted  March  20,  1894,  under  a 
clause  in  the  act  of  appropriations  for  the  Department  of  Agriculture  setting 
aside  $10,000  for  thu  purpose  of  making  "investigations  concerning  the 
feasibility  of  extending  the  demands  of  foreign  markets  for  the  agricultural 
products' of  the  United  States."  The  work  (If  the  section  consists  chiefly  in 
the  preparation  of  bulletins  and  circulars  designed  to  convey  information 
regarding  such  opportunities  us  exist  for  the  extension  of  nur  export  trade  in 
American  farm  products. 


APPENDIX.  539 


LIIiRAlty 


The  librarj'  of  the  department  was  first  otficially  recognized  by  the  appoint- 
ment of  J.  B.  liussell  a.s  librarian  in  1871.  The  collection  of  books  had  its 
origin  in  the  transfer  in  1896  of  the  works  on  agriculture  from  the  library  of 
the  Patent  OtKce.  Additions  have  been  made  from  time  to  time  by  exchange 
and  purchase.  The  library  now  contains  58,000  volumes,  and  is  undoubtedly 
the  best  separate  collection  on  agriculture  and  allied  subjects  in  the  United 
States — probably  the  best  in  the  world.  It  comprises  complete  sets  of  state 
agricultural  publications  and  files  of  many  of  the  agricultural  journals  from 
the  beginning;  a  large  collection  of  the  official  reports  on  agricultural  subjects 
issuedby  foreign  governments;  important  collections  in  botany,  horticulture, 
forestry,'  zoology,  and  entomology;  numerous  sets  of  scientific  serials;  a  well- 
selected  collection  of  encyclopedias,  atlases,  and  other  general  reference  works, 
and  a  small  collection  of  biography,  history,  and  general  literature.  A  quar- 
terly list  of  the  additions  to  the  library  is  published,  and  several  lists  of  books 
on  agricultural  subjects  have  been  issued. 

THE  MUSEUM. 

The  museum  had  its  beginning  in  the  old  agricultural  bureau  of  the  Patent 
Office,  the  nucleus  of  the  collection  being  a  large  series  of  fruit  models  and 
stuffed  birds,  the  work  of  Prof.  Townsend  Glover,  of  that  Bureau.  When  the 
Department  of  Agriculture  was  organized,  in  1862,  ]Mr.  Glover  became  its 
entomologist,  and  the  museum  was  established  under  him  in  186-4  as  a  recog- 
nized institution.  From  this  time  forward  its  collections  were  steadily  increased 
by  donations  and  purchases,  and  when  the  plans  were  being  drawn  for  a  sepa- 
rate building  for  the  Department  of  Agriculture,  the  large  hall  now  used  for 
the  library  "was  planned,  to  be  devoted  to  museum  purposes.  The  building 
was  occupied  about  the  beginning  of  1868,  and  the  muspum  moved  from  the 
Patent  Office.  About  this  time  1,he  Glover  collection  of  fruit  models,  birds, 
and  insects  was  purchased  by  a  special  appropriation  of  $10,000,  the  govern- 
ment having  had  the  loan  of  it  for  over  ten  years. 

LANDS  FOR  AGRICULTURAL  COLLEGES. 

The  day  following  the  establishment  of  the  Department  the  law  granting 
public  lands  for  the  establishment  of  agricultural  colleges  was  approved  by 
President  Lincoln.  The  original  bill  for  this  purpose  was  introduced  in  the 
House  in  1857  by  Hon.  Justin  S.  Morrill.  It  was  passed,  but  was  vetoed  by 
President  Buchanan.  In  December,  1861,  Mr.  Morrill  introduced  his  bill 
again,  but  on  May  2,  1862,  Senator  Wade  offered  a  similar  bill  in  the  Senate, 
and  in  June  it  passed  both  houses. 

The  act  passed  through  the  efforts  of  Hon.  William  Hatch,  the  Morrill 

law  of  1890  (p.  50),  and  this  act   constitute  the   largest  government  aid  to 

education  in  the  history  of  this  country. 

[Act  of  July  2,  1862.] 

AN  ACT  donating  public  lands  to  the  several  States  and  Territories  which  may  provide 
colleges  for  the  benefit  of  agriculture  and  the  mechanic  arts. 

Be  it  enacted  by  the  Senate  and  House  of  Representatives  of  the  United  States 
of  America  in.  Congress  Assembled,  That  "there  be  granted  to  the  several  states, 
for  the  purposes  hereinafter  mentioned,  an  amount  of  public  land,  to  be 
apportioned  to  each  state  a  quantity  equal  to  thirty  thousand  acres  for  each 
senator  and  representative  in  Congress  to  which  the  states  are  respectively 
entitled  by  the  apportionment  under  the  census  of  eighteen  hundred  and  sixty  : 


540  APPENDIX. 

Provided,  That  no  mineral  lands  shall  be  selected  or  purchased  under  the 
provisions  of  this  act. 

Sec.  2.  That  the  land  aforesaid,  after  being  surveyed,  shall  be  apportioned 
to  the  several  states  in  sections  or  subdivisions  of  sections,  not  less  than  one- 
quarter  of  a  section  ;  and  whenever  there  are  public  lamds  in  a  state  subject  to 
sale  at  private  entry  at  one  dollar  and  twenty-live  cents  per  acre,  the  quantity 
to  which  said  state  siiall  be  entitled  shall  be  selected  from  such  lands  within 
the  limits  of  such  state,  and  the  Secretary  of  the  Interior  is  hereby  directed  to 
issue  to  each  of  the  states  in  which  there  is  not  the  quantity  of  public  lands 
subject  to  sale  at  private  entry  at  one  dollar  and  twenty-tive  cents  per  acre,  to 
which  said  state  may  be  entitled  under  the  provisions  of  this  act,  land  scrip  to 
the  amount  in  acres  for  the  deficiency  of  its  distributive  share;  said  scrip 
to  be  sold  by  said  states  and  the  proceeds  thereof  applied  to  the  uses  and 
purposes  prescribed  in  this  act,  and  for  no  other  use  or  purpose  whatsoever: 
Provided,  That  in  no  case  shall  any  state  to  which  land  scrip  may  thus  be 
issued  be  allowed  to  locate  the  same  within  the  limits  of  any  other  state,  or  of 
any  territory  of  the  United  States,  but  their  assignees  may  thus  locate  said 
land  scrip  upon  any  of  the  unappropriated  lands  of  the  United  States  subject 
to  sale  at  private  entry  at  one  dollar  and  twenty-five  cents,  or  less,  per  acre: 
And p7'ovlded further ,  That  not  more  than  one  million  acres  shall  be  located  by 
such  assignees  in  any  one  of  the  states:  And  provided  ftirther^  That  no  such 
location  shall  be  made  before  one  year  from  the  passage  of  this  act. 

Sec.  3.  That  all  the  expenses  of  management,  superintendence,  and  taxes 
from  date  of  selection  of  said  lands,  previous  to  their  sales,  and  all  expenses 
incurred  in  the  management  and  disliursement  of  the  moneys  which  may  be 
received  therefrom,  shall  be  paid  by  the  states  to  which  they  may  belong,  out 
of  the  treasury  of  said  states,  so  that  the  entire  proceeds  of  the  sale  of  said 
lands  shall  be  applied  without  any  diminution  whatever  to  the  purposes  here- 
inafter mentioned. 

Sec.  4.  That  all  moneys  derived  from  the  sale  of  the  lands  aforesaid  by  the 
states  to  which  the  lands  are  apportioned,  and  from  the  sales  of  land  "scrip 
hereinbefore  provided  for,  shall  be  invested  in  stocks  of  the  United  States,  or 
of  the  states,  or  some  other  safe  stocks,  yielding  not  less  than  five  per  centum 
upon  the  par  value  of  said  stocks;  and  that  the  moneys  so  invested  shall 
constitute  a  perpetual  fund,  the  capital  of  which  shall  remain  forever 
undiminished  (except  so  far  as  may  be  provided  in  section  fifth  of  this  act), 
and  the  interest  of  which  shall  be  inviolably  appropriated,  by  each  state  which 
may  take  and  claim  the  benefit  of  this  act,  to  the  endowment,  support,  and 
maintenance  of  at  least  one  college  where  the  leading  object  shall  be,  without 
excluding  other  scientific  and  classical  studies,  and  including  military  tactics, 
to  teach  such  branches  of  learning  as  are  related  to  agriculture  and  the 
mechanic  arts,  in  such  manner  as  the  legislatures  of  the  states  may  respectively 
prescribe,  in  order  to  promote  the  liberal  and  practical  education  of  the 
industrial  classes  in  the  several  pursuits  and  professions  in  life. 

Sec.  5.  That  the  grant  of  land  and  land  scrip  hereby  authorized  shall  be 
made  on  the  following  conditions,  to  which,  as  well  as  to  the  provisions  here- 
inbefore contained  the  previous  assent  of  the  several  states  shall  be  signified  by 
legislative  acts: 

First.  If  any  portion  of  the  fund  invested,  as  provided  by  the  foregoing 
section,  or  any  portion  of  the  interest  thereon,  shall,  by  any  action  or  con- 
tingency, be  diminished  or  lost,  it  shall  ])e  replaced  by  the  state  to  which  it 
belongs,  so  that  the  capital  of  the  fund  shall  remain  forever  undiminished; 
and  the  annual  interest  shall  bo  regularly  applied  without  diminution  to  the 
purposes  mentioned  in  the  fourth  section  of  tliis  act,  except  that  a  sum,  not 
exceeding  ten  per  centum  upon  the  amount  received  by  any  state  under  the 
provisions  of  this  act,  may  be  expended  for  the  purchase  of  lands  for  sites  or 
experimental  farms,  whenever  authorized  by  the  respective  legislatures  of  said 
states. 

Second.  No  portion  of  said  fund,  nor  the  interest  thereon,  shall  be  applied, 


APPENDIX.  541 

directly  or  indirectly,  under  any  pretense  whatever,  to  the  purchase,  erection, 
preservation,  or  repair  of  any  building  or  buildings. 

Third.  Any  state  which  may  take  and  claim  the  benefit  of  the  provisions 
of  this  act  shall  provide,  within  five  years,  at  least  not  less  than  one  college, 
as  described  in  the  iburth  section  of  tliis  act,  or  the  grant  to  such  state  shall 
cease;  and  said  state  shall  be  bound  to  pay  the  United  States  the  amount 
received  of  any  lands  previously  sold,  and  tliat  the  title  to  purchasers  under 
the  state- shall  be  valid. 

Fourth,  An  annual  report  shall  be  made  regarding  the  progress  of  each 
college,  recording  any  improvements  and  experiments  made,  with  their  cost 
and  results,  and  such  other  matters,  including  state  industrial  and  economical 
statistics,  as  may  be  supposed  useful ;  one  copy  of  which  shall  be  transmitted 
by  mail  free,  by  each,  to  all  the  other  colleges  which  may  be  endowed  under 
the  provisions  of  this  act,  and  also  one  copy  to  the  Secretary  of  the  Interior. 

Fifth.  When  lands  shall  be  selected  from  those  which  have  been  raised  to 
double  the  minimum  price,  in  consequence  of  railroad  grants,  they  shall  be 
computed  to  the  states  at  the  maximum  price,  and  the  number  of  acres  propor- 
tionately diminished. 

Sixth.  No  state  vfhile  in  a  condition  of  rebellion  or  insurrection  against  the 
Government  of  the  United  States  shall  be  entitled  to  the  benefit  of  this  act. 

Seventh.  No  state  shall  be  entitled  to  the  benefits  of  this  act  unless  it  shall 
express  its  acceptance  thereof  by  its  legislature  within  two  years  from  the  date 
of  its  approval  by  the  President. 

Sec.  6.  That  land  scrip  issued  under  the  provisions  of  this  act  shall  not  be 
subject  to  location  until  after  the  fi^rst  day  of  January,  one  thousand  eight 
hundred  and  sixty-three. 

Sec.  7.  That  the  land  ofl&cers  shall  receive  the  same  fees  for  locating  land 
scrip  issued  under  the  provisions  of  this  act  as  is  now  allowed  for  the  location 
of  military  bounty  land  warrants  under  existing  laws  :  Provided,  Their  maxi- 
mum compensation  shall  not  be  thereby  increased. 

Sec.  8.  That  the  governors  of  the  several  states  to  which  scrip  shall  be 
issued  under  this  act  shall  be  required  to  report  annually  to  Congress  all  sales 
made  of  such  scrip  until  the  whole  shall  be  disposed  of,  the  amount  received 
for  the  same,  and  what  appropriation  has  been  made  of  the  proceeds. 

Approved  July  2,  1862. 

THE  SECOND   MORRILL  ACT.     ENDOWMENT  OF  AGRICUL- 
TURAL   COLLEGES. 

[Morrill  law,  August  30, 1890.] 

AN  ACT  to  apply  a  portion  of  the  proceeds  of  the  public  lands  to  the  more  complete  endow- 
ment and  support  of  the  colleges  for  the  benefit  of  agriculture  and  the  mechanic  arts 
established  under  the  provisions  of  an  act  of  Congress  approved  July  second,  eighteen 
hundred  and  sixty-two. 

Be  it  enacted,  hij  ihe  Senate  and  Ilon.te  of  Represenfatlveft  of  the  United  States 
of  America  in  Co)i;/rrss  as.scnibU'd ,  That  there  shall  be  and  hereby  is,  annually 
appropriated,  out  of  any  money  in  the  Treasury  not  otherwise  appropriated, 
arising  from  the  sales  of  public  lands,  to  be  paid  as  hereinafter  provided,  to 
each  state  and  territory  ft)r  the  more  complete  endowment  and  maintenance  of 
colleges  for  the  benefit  of  agriculture  and  the  mechanic  arts  now  established,  or 
which  may  be  hereafter  established,  in  accordance  with  an  act  of  Congress 
approved  July  second,  eighteen  liundred  and  sixty-two,  the  sum  of  fifteen 
thousand  dollars  for  the  year  ending  June  thirtieth,  eighteen  hundred  and 
ninety,  and  an  annual  increase  of  the  amount  of  such  appropriation  thereafter 
for  ten  years  by  an  additional  sura  of  one  thousand  dollars  over  the  preceding 
year,  and  the  annual  amount  to  be  paid  thereafter  to  each  state  and  territory 
shall  be  twenty -five  thousand  dollars,  to  be  applied  only  to  instruction  in  agri- 
culture, the  mechanic  arts,  the  English  language,  and  the  various  branches  of 


542  APPENDIX. 

mathematical,  physical,  natural,  and  economic  science,  with  special  reference 
to  their  applications  in  the  industries  of  life,  and  to  the  facilities  for  such  instruc- 
tion: Provided,  That  no  money  shall  be  paid  out  under  this  act  to  any  state  or 
territory  for  the  support  and  maintenance  of  a  college  where  a  distinction  of 
race  or  color  is  made  in  the  admission  of  students,  but  the  establishment  and 
maintenance  of  such  colleges  separately  for  white  and  colored  students  shall  be 
held  to  be  a  compliance  with  the  provisions  of  this  act  if  the  funds  received  in 
such  state  or  territory  be  equitably  divided  as  hereinafter  set  forth:  Provided, 
That  in  any  state  in  which  there  has  been  one  college  established  in  pursuance 
of  the  act  of  July  second,  eighteen  hundred  and  sixty-two,  and  also  in  which 
an  educational  institution  ol"  like  character  has  been  established,  or  may  be 
hereafter  established,  and  is  now  aided  by  such  state  from  its  own  revenue,  for 
the  education  of  colored  students  in  agriculture  and  the  mechanic  arts,  however 
named  or  styled,  or  whether  or  not  it  "has  received  money  heretofore  under  the 
act  to  which  this  act  is  an  amendment,  the  Legislature  of  such  state  may  propose 
and  report  to  the  Secretary  of  the  Interior  a  just  and  equitable  division  of  the 
fund  to  be  received  under  the  act  between  one  college  for  white  students  and 
one  institution  for  colored  students  established  as  aforesaid,  which  shall  be 
divided  into  two  parts  and  paid  accordingly,  and  thereupon  such  institution  for 
colored  students  shall  be  entitled  to  the  benefits  of  this  act  and  subject  to  its 
provisions,  as  much  as  it  would  have  been  if  it  had  been  included  under  the  act 
of  eighteen  hundred  and  sixty-two,  and  the  fulfilment  of  the  foregoing  provi- 
sions shall  be  taken  as  a  compliance  with  the  provision  in  reference  to  separate 
colleges  for  white  and  colored  students. 

Sec.  2.  That  the-sums  hereby  appropriated  to  the  states  and  territories  for 
the  further  endowment  and  support  of  colleges  shall  be  annually  paid  on  or 
before  the  thirtv-flrstday  of  July  of  each  year,  by  the  Secretary  of  the  Treasury, 
upon  the  warrant  of  the  Secretary  of  the  Interior,  out  of  the  Treasury  of  the 
United  States,  to  the  state  or  territorial  treasurer,  or  to  such  officer  as  shall  be 
designated  by  the  laws  of  such  state  or  territory  to  receive  the  same,  who  shall, 
upon  the  order  of  the  trustees  of  the  college,  or  the  institution  for  colored 
students,  immediately  pay  over  said  sums  to  the  treasurers  of  the  respective 
colleges  or  other  institutions  entitled  to  receive  the  same,  and  such  treasurers 
shairbe  required  to  report  to  the  Secretary  of  Agriculture  and  to  the  Secretary 
of  the  Interior,  on  or  before  the  first  day  of  September  of  each  year,  a  detailed 
statement  of  the  amount  so  received  and  of  its  disbursement.  The  grants  of 
moneys  authorized  by  this  act  are  made  subject  to  the  legislative  assent  of  the 
several  states  and  territories  to  the  purpose  of  said  grants  :  Provided,  That  pay- 
ments of  such  instalments  of  the  appropriation  herein  made  as  shall  become 
due  to  any  state  before  the  adjournment  of  the  regular  session  of  Legislature 
meeting  next  after  the  passage'of  this  act  shall  be  made  upon  the  assent  of  the 
governor  thereof,  duly  certified  to  the  Secretary  of  the  Treasury. 

Sec.  3.  That  if  any  portion  of  the  moneys  received  by  the  designated  officer 
of  the  state  or  territory  for  the  further  and  more  complete  endowment,  support, 
and  maintenance  of  colleges,  or  of  institutions  for  colored  students,  as  provided 
in  this  act,  shall,  bv  any  action  or  contingency ,  be  diminished  or  lost,  or  be  mis- 
applied, it'shall  be"  replaced  by  the  state  or  territory  to  which  it  belongs,  and 
until  so' replaced  no  subsequent  appropriation  shall  be  apportioned  or  paid  to 
such  state  or  territory;  and  no  portion  of  said  moneys  shall  be  applied,  directly 
or  indirectly,  under  any  pretense  whatever,  to  the  purchase,  erection,  preserva- 
tion or  repair  of  any  building  or  buildings.  An  annual  report  by  the  president 
of  each  of  said  colleges  shall  "be  made  to  the  Secretary  of  Agriculture,  as  well  as 
to  the  Secretarv  of  the  Interior,  regarding  the  condition  and  progress  of  each 
college,  including  statistical  information  in  relation  to  its  receipts  and  expend- 
itures, its  library,  the  number  of  its  students  and  professors,  and  also  as  to  any 
improvements  and  experiments  made  under  the  direction  of  any  experiment 
stations  attached  to  said  colleges,  with  their  costs  and  results,  and  such  other 
industrial  and  economical  statistics  as  may  be  regarded  as  useful,  one  copy  of 
which  shall  be  transmitted  by  mail  free  to  all  other  colleges  further  endowed 
under  this  act. 


APPENDIX.  543 

Sec.  4,  That  on  or  before  the  first  day  of  July  in  each  year,  after  the  passage 
of  this  act,  the  Secretary  of  the  Interior  shall  ascertain  and  certify  to  the  Secre- 
tary of  the  Treasury  as  to  each  state  and  territory  whether  it  "is  entitled  to 
receive  its  share  of  the  annual  appropriation  for  colleges,  or  of  institutions  for 
colored  students,  under  this  act,  and  the  amount  which  thereupon  each  is 
entitled,  respectively,  to  receive.  If  the  Secretary  of  the  Interior  shall  with- 
hold a  certificate  from  any  state  or  territory  of  its  appropriation,  the  facts  and 
reasons  therefor  shall  be  reported  to  the  president,  and  the  amount  involved 
shall  be  kept  separate  in  the  treasury  until  the  close  of  the  next  Congress,  in 
order  that  the  state  or  territory  may,  if  it  should  so  desire,  appeal  to  Congress 
from  the  determination  of  the  Secretary  of  the  Interior.  If  the  next  Congress 
shall  not  direct  such  sum  to  be  paid  it  shall  be  covered  into  the  Treasury.  And 
the  Secretary  of  the  Interior  is  hereby  charged  with  the  proper  administration 
of  this  law. 

Sec.  5.  That  the  Secretary  of  the  Interior  shall  annually  report  to  Congress 
the  disbursements  which  have  been  made  in  all  the  states  and  territories,  and 
also  whether  the  appropriation  of  any  state  or  territory  has  been  withheld,  and 
if  so,  the  reasons  therefor. 

Sec.  6.  Congress  may  at  any  time  amend,  suspend,  or  repeal  any  or  all  of 
the  provisions  of  this  act. 

Approved,  August  30,  1890. 

LAW  ESTABLISHING  AGRICULTURAL  EXPERIMENT  STATIONS. 

[Hatch  Act,  March  2, 1887.] 

AN  ACT  to  establish  agricultural  experiment  stations  in  connection  with  the  colleges 
established  in  the  several  states  under  the  provisions  of  an  act  approved  July  second, 
eighteen  hundred  and  sixty-two,  and  of  the  acts  supplementary  tliereto. 

Be  it  enacted  by  the  Senate  and  House  of  Re^yresentatives  of  the  United  States 
of  America  in  Co7igrcss  assembled,  That,  in  order  to  aid  in  acquiring  and  diffus- 
ing among  the  people  of  the  United  States  useful  and  practical  information  on 
subjects  connected  with  agriculture,  and  to  promote  scientific  investigation  and 
experiment  respecting  the  principles  and  applications  of  agricultural  science, 
there  shall  be  established,  under  direction  of  the  college  or  colleges  or  agri- 
cultural department  of  colleges  in  each  state  or  territory  established,  or  which 
may  hereafter  be  established,  in  accordance  with  the  provisions  of  an  act 
approved  July  second,  eighteen  hundred  and  sixty-two,  entitled  "An  act 
donating  public  lands  to  the  several  states  and  territories  which  may  provide 
colleges  for  the  benefit  of  agriculture  and  the  mechanic  arts,"  or  any  of  the 
supplements  to  said  act,  a  department  to  be  known  and  designated  as  an  "  agri- 
cultural experiment  station:"  Proridrd,  that  in  any  state  or  territory  in  which 
two  such  colleges  have  been  or  may  be  so  established,  the  appropriation  herein- 
after made  to  such  state  or  territory  shall  be  equally  divided  between  such 
colleges,  unless  the  Legislature  of  such  state  or  territory  shall  otherwise  direct. 

Sec.  2.  That  it  shall  be  the  object  and  duty  of  said  experiment  stations  to 
conduct  original  researches  or  verify  experiments  on  the  physiology  of  plants 
and  animals;  the  diseases  to  which  they  are  severally  subject,  with  the  remedies 
for  the  same;  the  chemical  composition  of  useful  plants  at  their  different  stages 
of  growth;  the  comparative  advantages  of  rotative  cropping  as  pursued  under  a 
varying  series  of  crops;  the  capacity  of  new  plants  or  trees  for  acclimation;  the 
analysis  of  soils  and  water;  the  chemical  composition  of  manures,  natural  oi 
artificial,  with  experiments  designed  to  test  their  comparative  efiects  on  crops 
of  different  kinds;  the  adaptation  and  value  of  grasses  and  forage  plants;  the 
composition  and  digestibility  of  the  different  kinds  of  food  for  domestic  animals; 
the  scientific  and  economic  questions  involved  in  the  production  of  butter  and 
cheese;  and  such  other  researches  or  experiments  bearing  directly  on  the  agri- 
cultural industry  of  the  United  States  as  may  in  each  case  be  deemed  advisable, 


544  APPEXDIX. 

having  due  regai'd  to  the  varying  conditions  and  needs  of  the  respective  states 
or  territories. 

Sec.  3.  That  in  order  to  secure,  as  far  as  practicable,  uniformity  of  methods 
and  results  in  the  work  of  said  stations,  it  shall  be  the  duty  of  the  United  States 
Commissioner  of  Agriculture  to  furnish  forms,  as  far  as  practicable,  for  the 
tabulation  of  results  of  investigation  or  experiments;  to  indicate  from  time  to 
time  such  lines  of  inquiry  as  to  him  shall  seem  most  important;  and,  in  gen- 
eral, to  furnish  such  advice  and  assistance  as  will  best  promote  the  purpose 
of  this  act.  It  shall  be  the  duty  of  each  of  said  stations  annually,  on  or  before 
the  first  day  of  February,  to  make  to  the  governor  of  the  state  or  territory  in 
which  it  is  located  a  full  and  detailed  report  of  its  operations,  including  a  state- 
ment of  receipts  and  expenditures,  a  copy  of  which  report  shall  be  sent  to  each 
of  said  stations,  to  the  said  Commissioner  of  Agriculture,  and  to  the  Secretary  of 
the  Treasury  of  the  United  States. 

Sec.  4.  That  bulletins  or  reports  of  progress  shall  be  published  at  said  stations 
at  least  once  in  three  months,  one  copy  of  which  shall  be  sent  to  each  newspaper 
in  the  states  or  territories  in  which  they  are  respectively  located,  and  to  such 
individuals  actually  engaged  in  farming  as  may  request  the  same,  and  as  far  as 
the  means  of  the  station  will  permit.  Such  bulletins  or  reports  and  the  annual 
reports  of  said  stations  shall  be  transmitted  in  the  mails  of  the  United  States  free 
of  charge  for  postage,  under  such  regulations  as  the  Postmaster-General  may  from 
time  to  time  prescribe. 

Sec.  5.  That  for  the  purpose  of  paying  the  necessary  expenses  of  conducting 
investigations  and  experiments  and  printing  and  distributing  the  results  as 
hereinbefore  prescribed,  the  sum  of  fifteen  thousand  dollars  per  annum  is  hereby 
appropriated  to  each  state,  to  be  especially  provided  for  by  Congress  in  the 
appropriations  from  year  to  year,  and  to  each  territory  entitled  under  the  pro- 
visions of  section  eight  of  this  act,  out  of  any  money  in  the  Treasury  proceeding 
from  the  sales  of  public  lands,  to  be  paid  in  equal  quarterly  payments  on  the  first 
day  of  January,  April,  July,  and  October  in  each  year,  to  the  Treasurer  or  other 
officer  duly  appointed  by  the  governing  boards  of  said  colleges  to  receive  the 
same,  the  first  payment  to  be  made  on  the  first  day  of  October,  eighteen  hundred 
and  eighty-seven:  Provided,  however,  That  out  of  the  first  annual  appropriation 
so  received  by  any  station  an  amount  not  exceeding  one-fifth  may  be  expended 
in  the  erection,  enlargement  or  repair  of  a  building  or  buildings  necessary  for 
carrying  on  the  work  of  such  station;  and  thereafter  an  amount  not  exceeding 
five  per  centum  of  such  annual  appropriation  may  be  so  expended. 

Sec.  6.  That  whenever  it  shall  appear  to  the  Secretary  of  the  Treasury,  from 
the  annual  statement  of  receipts  and  expenditures  of  any  of  said  stations,  that  a 
portion  of  the  preceding  annual  appropriation  remains  unexpended,  such 
amount  shall  be  deducted  from  the  next  succeeding  annual  appropriation  to 
such  station,  in  order  that  the  amount  of  money  appropriated  to  any  station 
shall  not  exceed  the  amount  actually  and  necessarily  required  for  its  mainte- 
nance and  support. 

Sec.  7.  That  nothing  in  this  act  shall  be  construed  to  impair  or  modify  the 
legal  relation  existing  between  any  of  the  said  colleges  and  the  government  of 
the  states  or  territories  in  which  they  are  respectively  located. 

Sec.  8.  That  in  states  having  colleges  entitled  under  this  section  to  the 
bentifits  of  this  act,  and  having  also  agricultural  experiment  stations  established 
by  law  separate  from  said  colleges,  such  states  shall  be  authorized  to  apply  such 
benefits  to  experiments  at  stations  so  established  by  such  states;  and  in  case  any 
state  shall  have  established  under  the  provisions  of  said  act  of  July  second,  afore- 
said, an  agricultural  department  or  experimental  station,  in  connection  with 
any  university,  college,  or  institution  not  distinctively  an  agricultural  college 
or  school,  and  such  state  shall  have  established  or  shall  hereafter  establish  a 
separate  agricultural  college  or  school  which  shall  have  connected  therewith  an 
experimental  farm  or  station,  the  Legislature  of  such  state  may  apply  in  whole 
or  in  part  the  appropriation  by  this  act  made  to  such  separate  agricultural  college 
or  school,  and  no  Legislature  shall  by  contract,  express  or  implied,  disable  itself 
from  so  doing. 


APPENDIX.  545 

Sec.  9.  That  the  grants  of  moneys  authorized  by  this  act  are  made  subject 
to  the  legislative  assent  of  the  several  states  and  territories  to  the  purposes  of 
said  grants:  Provided,  That  payment  of  such  instalments  of  the  appropriation 
herein  made  as  shall  become  due  to  any  state  before  the  adjournment  of  the 
regular  session  of  its  Legislature  meeting  next  after  the  passage  of  this  act  shall 
be  made  upon  the  assent  of  the  governor  thereof,  duly  certified  to  the  Secretary 
of  the  Treasury. 

Sec.  10.  Nothing  in  this  act  shall  be  held  or  construed  as  binding  the  United 
States  to  continue  any  payments  from  the  Treasury  to  any  or  all  the  states  or 
institutions  mentioned  in  this  act,  but  Congress  may  at  any  time  amend,  suspend, 
or  repeal  any  or  all  the  provisions  of  this  act. 

Approved,  March  2,  1887. 


35 


Appendix  B. 


THE  WORK  OF  A  FIRST-CLASS  DAIRY  SCHOOL. 


[This  description  of  Dairy  School  work  is  from  a  bulletin  of  the  University 
of  "Wisconsin.  Other  Dairy  Schools  endeavor  to  do  similar  work,  and  do  so  so 
far  as  means  are  provided.  Several  other  Agricultural  Colleges  have  Dairy 
Schools  of  the  first  class,  but  the  Wisconsin  course  will  indicate  the  nature  of 
the  work  in  all.] 

/.     COURSE  OF  STUDY  IN  THE  WISCONSIN  DAIRY  SCHOOL. 

1.  Twenty-four  lectures  by  Dr.  S.  M.  Babcock  on  the  constitution  uf  milk, 
the  various  methods  of  milk  testing,  the  conditions  which  affect  creaming  and 
churning,  the  principles  involved  in  the  manufacture  of  cheese,  the  relation 
between  composition  of  milk  and  yield  of  cheese,  and  allied  subjects. 

2.  Sixteen  lectures  in  dairy  bacteriology,  by  Dr.  H.  L.  Russell,  on  the  re- 
lation of  bacteria  to  dairy  problems,  including  the  care  and  treatment  of  milk 
in  its  natural  state,  normal  and  abnormal  fermentations  in  milk,  butter,  and 
cheese,  and  the  preservation  of  milk  for  economic  purposes. 

This  course  will  be  based  upon  text-book  work,  supplemented  by  lectures  and 
demonstrations.  Quizzes,  involving  the  practical  relation  of  above  subjects  to 
modern  dairy  principles,  will  be  held  from  time  to  time. 

3.  Creamery  management  and  dairy  book-keeping,  by  Prof,  E.  H.  Farring- 
ton,  including  instruction  in  recording  milk  at  the  intake,  calculating  patrons' 
dividends,  shipping  accounts,  and  other  matters  relating  to  the  business  of  the 
creamery  and  cheese  factory.  > 

4.  Ten  lectures  on  the  theory  and  art  of  cheese-making,  by  Mr.  J.  W.  Decker. 

5.  Ten  lectures  and  demonstrations,  by  Prof.  A.  W.  Richter,  Instructor  in 
Engineering,  on  the  care  and  management  of  the  boiler  and  engine. 

6.  Eight  lectures,  by  Prof.  F.  H.  King,  on  heating,  ventilation,  and  other 
physical  problems  connected  with  dairy  practice. 

"7.  Eight  lectures  by  Prof.  W.  L.  Carlyle,  on  the  breeding  and  selection  of 
dairy  cows. 

8.  Eight  lectures,  by  Prof.  W.  A.  Henry,  on  the  feeding  and  general  man- 
agement of  dairy  cows. 

9.  Eight  lectures,  by  Dr.  Simon  Beattee,  on  the  common  diseases  of  the 
dairy  cow. 

FACILITIES  FOR  INSTRUCTION. 

In  Hiram  Smith  Hall  the  University  of  Wisconsin  has  a  dairy  building 
which,  for  size,  appearance,  and  equipment,  is  in  some  fair  degree  commensu- 
rate with  the  great  dairy  interests  of  our  commonwealth.  It  is  constructed  of 
Dunville  white  sandstone  and  white  brick,  the  exterior  of  the  upper  stories 

(54fi) 


APPENDIX.  547 

being  finished  in  pebble  and  beam  work.  With  equipment  it  represents  an 
outlay  of  about  $40,000.  The  main  structure  is  seventy-five  feet  front  by 
flftv-four  feet  in  depth,  and  three  full  stories  in  height.  The  boiler  room  and 
refrigerator  form  an  addition  twenty  feet  by  forty-eight  feet,  one  story  in 
height.  In  the  boiler  room  are  a  sixty  horse-power  steel  boiler  and  a  twenty- 
five  horse-power    AUis-Corliss  engine. 

The  university  operates  the  creamery,  also  the  milk  and  cream  pasteurizing 
departments  in  the  Dairy  School  building  throughout  the  year,  receiving  milk 
from  about  sixty  farms  in  the  vicinity  of  Madison.  The  milk  supply  varies 
from  five  thousand  to  ten  thousand  pounds  per  day,  according  to  the  season  of 
the  year.  The  products  of  the  Dairy  School  are  fancy  print  and  larger  packages 
of  butter,  full  cream  cheddar  cheese,  and  pasteurized  cream.  These  are  delivered 
daily  to  families  in  Madison  and  other  cities.  Daily  shipments  are  also  made  to 
Chicago  and  Milwaukee.  Pasteurized  milk  is  supplied  to  invalids  and  ailing 
infants  upon  doctors'  prescriptions,  the  results  proving  highly  satisfactory.  Six 
persons  are  employed  regularly  in  manufacturing  and  delivering  the  products. 
By  handling  milk  in  such  quantities,  and  catering  to  a  select  trade,  those  in 
charge  of  the  school  are  compelled,  by  the  very  nature  of  the  work,  to  keep  well 
to  the  front  in  dairy  knowledge  and  practice. 

The  purpose  of  the  presentplan  of  operating  the  factory  is  not  money-making, 
but  that  there  may  be  the  largest  opportuni\y  for  investigation  and  that  the 
instructors  may  be"practical  and  up  to  date  in  their  knowledge  of  dairy  matters. 

• 
THE  CREAMERY. 

The  c-eamery  room,  thirty-six  by  forty-eight  feet  in  size,  is  on  the  first  floor. 
Milk  is  delivered  at  a  covered  driveway  in  the  rear,  and,  from  the  weigh  can, 
flows  by  gravity  into  a  large  receiving  vat  on  a  platform  in  the  creamery.  All 
of  the  latest  forms  of  the  leading  power  separators  will  be  in  use  for  instruction. 

Near  the  front  of  the  room  are  two  three  hundred  gallon  cream  ripening 
vats,  beside  which  are  two  box  churns  of  difterent  patterns  and  a  four  hundred 
and  fifty-gallon  combined  churn  and  butter-worker.  In  front  of  these  is  the 
Mason  power  butter-worker  and  other  apparatus  incident  to  the  creamery.  A 
Wicks  refrigerator  opens  ofl'  the  creamery  for  the  storage  of  butter. 

Two  instructors  direct  the  workof  the  students  running  the  separators,  which 
will  include  the  leading  kinds  and  latest  forms  of  centrifugal-power  cream 
separators,  while  one  instructor  supervises  the  students  in  charge  of  the  cream 
and  the  churning  and  working  of  the  butter.  Professor  Farrington  gives 
general  supervision  and  receives  the  blanks  filled  out  daily  by  the  students, 
each  (me  of  whom  is  marked  upon  his  work. 

From  time  to  time  samples  of  butter  secured  from  different  sources  will  be 
scored  by  the  class,  for  the  purpose  of  increasing  their  knowledge  of  the  wants 
of  the  market. 

Butter  made  by  the  students  is  also  inspected  and  its  defects  as  well  as  the 
points  of  excellence  are  explained  and  traced  to  their  causes. 

The  process  of  butter-making  will  be  conducted  daily  on  the  creamery  plan, 
from  analyzing  the  milk  at  the  intake  to  marking  packages  for  shipping  from 
the  refrigerator. 

MILK  INSPECTION. 

A  detail  of  students,  in  charge  of  an  instructor,  receives  the  milk  daily  vts  ft 
is  delivered  by  the  sixty  patrons  at  the  creamery  intake.  The  students  are 
taught  to  inspect  the  different  lots  of  milk  as  they  arrive,  using  the  Wisconsin 
curd  test,  which  aids  in  detecting  those  lots  of  milk  that  are  particularly  in- 
jurious in  cheese  making,  also  to  test  the  acidity  of  each  lot  of  milk  and  how 
to  take  the  composite  samples  for  the  weekly  fat  tests. 


548  APPENDIX. 

The  automatic  skim  milk  weigher  is  also  used  for  apportioning  to  each  patron 
his  share  of  the  skim  milk.  A  test  of  the  speed,  capacity  and  skimming  effi- 
ciency of  the  separators  is  made  by  the  students  each  day.  After  they  have 
become  sufficiently  familiar  with  the  different  machines,  they  are  given  an 
opportunity  to  note  the  effect  which  a  change  of  speed  of  the  separator  bowl, 
variation  in  temperature  of  milk,  and  an  increase  or  decrease  in  the  amount  of 
milk  separated  per  hour,  has  on  the  cream  and  skim  milk  obtained  from  the 
different  separators.  The  effect  of  various  changes  in  the  cream  ripening, 
churning  and  butter-working  processes  is  also  studied,  as  well  as  the  packing 
and  shipping  of  butter  in  different  styles  of  packages. 

Printed  blanks  are  used  in  the  instruction  to  help  the  students  understand 
the  work  expected  of  them  each  day.  Various  observations  and  records  of 
weights  and  tests  are  reported  on  these  twenty  different  blanks,  and  the  students 
are  marked  on  the  neatness  and  appearance  of  their  daily  blanks,  as  well  as  on 
the  accuracy  and  faithfulness  with  which  their  work  has  been  done. 

THE  CHEESE  ROOM. 

The  cheese  room  adjoining  the  creamery  is  twenty-seven  by  thirty-three 
feet  in  area.  In  this  there  are  eight  steam-heated  cheese  vats  of  three  hundred 
pounds  capacity,  each  equipped  with  a  complete  set  of  cheese-making  apparatus. 
An  elevator  carries  the  cheesflifnd  other  materials  from  this  room  to  the  upper 
floors.  Adjoining  the  cheese  room  is  a  testing  room,  a  store-room  and  a  press- 
room, with  gang  cheese  presses. 

In  the  cheese  room  the  students  will  be  drilled  in  the  use  of  the  rennet  test, 
which  has  done  so  much  to  advance  cheese-making,  the  use  of  curd  mills, 
lactometers,  and  acid  tests  as  applied  to  cheese-making,  and  are  given  a  thorough 
drill  in  judging  cheese.  Milk  from  the  different  palrons  will  be  examined  by 
the  "Wisconsin  curd  test,  which  has  proved  so  valuable  in  detecting  those  lots 
that  are  of  doubtful  quality  in  cheese-making.  The  hot-iron  test,  both  for 
indicating  the  time  for  drawing  the  whey  and  when  to  put  the  curd  to  press,  will 
be  used.  The  milk  and  whey  will  be  tested,  so  that  the  losses  in  the  process  of 
manufacturing  may  be  located.  Instruction  will  be  given  in  the  proper  ban- 
daging, pressing,  and  dressing  of  cheese,  as  well  as  the  proper  temperature  of  the 
curing  room  and  care  of  cheese  on  the  shelves.  Samples  of  cheese  from  different 
sources  will  be  secured,  and  the  students  given  practice  in  scoring  them,  esti- 
mating their  worth,  and  recognizing  the  demands  of  the  market. 

Some  one  of  the  students  at  each  vat  is  given  a  foreman's  blank  each  day, 
while  others  give  special  attention  to  the  rennet  test,  temperatures,  salting, 
bandaging,  and  pressing  the  cheese.  The  work  is  systematically  arranged  so 
that  every  student  gets  a  thorough  drill  in  the  various  manipulations  of  cheese- 
making.  Experiments  are  also  made  to  show  the  effect  which  changes  in  the 
temperature  of  cooking  the  curd,  as  well  as  different  amounts  of  rennet  or  salt, 
have  upon  the  quality  of  the  cheese. 

Three  instructors  are  required  to  direct  the  work  of  the  students  in  the  cheese 
room.  The  head  instructor  gives  general  dii'octions  and  receives  the  blanks 
filled  out  daily  by  each  student,  and  marks  all  students  under  liis  charge.  Each 
of  the  remaining  instractors  has  charge  of  the  students  on  duty  at  four  cheese 
vats. 

PASTE  URIZA  TION. 

The  pasteurization  of  milk  and  cream  has  grown  to  such  importance  that  this 
work  has  been  given  a  room  under  charge  of  a  special  instructor  in  this  branch. 

Here  is  found  a  power  pasteurizer,  a  power  bottle-washer,  and  other  pieces  of 
apparatus  and  devices  requisite  to  handling  pasteurized  cream  and  milk  in  a 
commercial  way. 


APPENDIX. 


549 


A  special  course  in  the  preservation  of  milk  and  cream  for  direct  consumption 
will  be  given  during  the  latter  part  of  the  Dairy  School.  Several  lectures  on 
this  subject  will  be  given  by  Dr.  Russell,  who  will  have  general  supervision  of 
the  work.  The  course  will  include  an  exposition  of  the  bacteriological  princi- 
ples underlying  the  methods  of  pasteurizing  and  sterilizing  of  milk  and  cream. 
The  student  will  be  taught  the  conditions  essential  in  apparatus  for  this  purpose, 
the  methods  of  manipulating  the  same,  methods  of  restoring  the  viscosity  of 
pasteurized  cream,  and  the  way  that  milk  and  cream  should  be  handled  so  as  to 
be  guaranteed  free  from  all  disease  germs. 

Owing  to  the  present  restricted  space  at  our  disposal,  only  a  limited  number 
of  students  can  be  accepted.  Those  students  whose  average  standing  in  the 
mid-term  examination  is  eighty-five  or  above,  and  who  show  special  proficiency 
in  bacteriology  and  the  practical  creamery  work  will  be  eligible  to  this  course. 
A  special  fee  of  $1.00  will  be  charged  for  this  course. 

An  opportunity  will  be  offered  those  students  who  desire  to  remain  after  the 
close  of  the  school  to  do  further  practical  work  in  the  pasteurizing  room. 

THE  OFFICE,  LABORATORY,  ETC. 

In  the  second  story  is  4be  office,  with  fire-proof  vault,  lockers  lor  work- 
clothes  of  one  hundred  students,  toilet  and  bath  rooms;  also  a  cheese-curing  room 
and  a  large  room  for  instruction  in  farm  dairying  and  advanced  cheese-making. 
In  the  third  story  is  a  reading  room,  lecture  room,*^nd  alarge  laboratory'  for  milk 
analysis,  also  a  private  laboratory  for  advanced  work. 

AH  of  the  rooms  are  heated  directly  by  steam  radiators  and  indirectly  by  hot 
air  forced  to  the  several  rooms  by  a  Sturtevant  fan,  run  by  its  own  two  horse- 
power engine.  The  building  is  designed  wholly  with  reference  to  practical 
instruction  in  dairying,  and  is  arranged  for  the  accommodation  of  one  hundred 
students. 

MILK  TESTING. 

To  be  abreast  of  the  times,  the  creamery  operator  and  the  cheese-maker 
must  be  thoroughly  skilled  in  the  use  of  the  Babcock  test,  an  apparatus  in- 
vented by  Dr.  Babcock,  one  of  the  instructors  in  the  Dairy  School.  Students 
will  be  given  thorough  instruction  in  the  use  of  the  Babcock  and  other  simple 
milk  tests,  and  will  be  taught  to  determine  accurately  the  amount  of  fat  in 
samples  of  full  milk,  skim  milk,  buttermilk,  and  whey.  Steam  turbine,  belt, 
and  hand-power  Babcock  test  machines  will  be  provided.  By  the  use  of  the 
test  in  connection  with  the  Quevenne  lactometer  students  are  taught  to  detect 
watering  and  skimming;  with  this  test  and  a  balance  he  will  determine  closely 
the  amount  of  fat  in  a  given  sample  of  cheese  He  will  also  be  taught  to 
determine  approximately  the  amount  of  fat  in  a  given  sample  of  butter. 
Lastly,  he  will  be  shown  how  to  measure  the  necks  of  the  test  bottles  in  such 
a  way  as  to  know  if  they  are  correctly  graduated. 

This  course  will  be  under  the  direction  of  Professor  Farrington. 

DIVISION  OF  DUTIES. 

Dairy  instruction  will  be  divided  into  five  courses — lectures  on  dairying, 
milk-testing,  butter-making,  cheese-making,  and  pasteurization.  The  class 
will  be  divided  into  three  "sections,  one  of  which  will  be  assigned  to  the  lab- 
oratory, a  second  to  the  creamery,  and  the  third  to  the  cheese  room.  All 
dairy  students  will  meet  in  the  lecture  room  on  week  days  daily  from  eight  to 
nine  o'clock,  for  the  lecture  on  dairying.  At  the  close  of  the  lecture  each 
section  will  pass  to  its  assigned  duties  in  the  laboratory,  creamery,  or  cheese- 
room.  By  changing  from  day  to  day,  each  student  will  spend  two  days  each 
week  in  each  of  the  three  departments. 


550  APPENDIX. 

FARM  DAIRY  INSTRUCTION. 

This  circular  will  tall  into  the  hands  of  some  who  do  not  intend  to  become 
factory  operators,  but  rather  dairy  farmers.  Such  students  should  take  the 
Short  Course  in  Agriculture,  which  opens  and  closes  at  the  same  time  as  the 
Dairy  Course. 

In  the  Short  Course  every  line  of  instruction  is  arranged  to  give  the  largest 
amount  of  help  possible  to  young  farmers  who  have  but  a  limited  time  for 
study.  Not  only  are  the  leading  lines  of  agriculture  considered,  but  farm 
bookkeeping  and'  business  accounts,  farm  blacksmithing,  farm  carpentry,  etc., 
are  taught.     There  are  thirteen  instructors  in  this  course. 

There  will  be  lectures  on  dairying  by  Dr.  Babcock  and  practical  instruction 
in  butter-making  by  an  assistant. 

Thorough  instruction  will  be  given  in  the  use  of  the  Babcock  milk  test  and 
the  separation  of  cream  by  all  the  leading  hand  separators.  The  churning  of 
cream  and  working  and  packing  of  butter  will  constitute  a  portion  of  this 
instruction. 

An  Illustrated  Clreular  describing  the  Short  Course  studies  will  he  sent  on 
application  to  R.  A.  MooRK,  Madison,   Wis. 

ENAMINATIONS. 

At  intervals  during  the  term,  and  at  its  close,  the  students  in  each  of  the 
sub-courses  will  be  subjected  to  examination,  written  and  practical.  During 
the  term  students  are  given  lifteen  written  examinations,  and  they  are  also 
marked  by  five  instructors  in  the  ditterent  lines  of  practical  work.  This  in- 
cludes the  running  of  the  separators,  cream  ripening,  butter-making,  cheese- 
making,  and  milk  testing.  The  students  are  marked  on  the  scale  of  one 
hundred  as  perfect  and  sixty  as  failing  to  pass.  At  the  close  of  the  term  a 
written  statement,  signed  by  the  dean,  will  be  furnished,  giving  the  work 
performed  and  his  standing,  as  shown  by  the  examinations.  No  statement  of 
standing  will  be  given  except  to  students  who  have  attended  the  full  term  and 
who  have  taken  all  the  examinations. 

FACTORY  AND  ADVANCED  DAIRY  INSTRUCTION. 

Opportunity  is  offered   for  dairy  instruction  along  theoretical  and  practical 
lines  at  other  seasons  of  the  year  than  during  the  session  of  the  Dairy  School. 
This  instruction  will  embrace  the  two  following  lines  of  work  : — 

1.  Practical  creamery  work. 

2.  Advanced  dairying. 

PRACTICAL  INSTRUCTION. 

During  that  part  of  the  year  in  which  the  Dairy  School  is  not  in  session  a 
limited  number  of  young  men  without  previous  factory  training  will  be 
accepted  as  "factory  pupils"  in  our  creamery,  coming  for  the  purpose  of 
preparing  themselves  thoroughly  for  the  Dairy  School  instruction  given  in 
the  winter. 

A  circular  describing  this  work  will  be  sent  to  any  one  applying  for  it. 

Opportunity  will  also  be  given  for  students  who  have  taken  the  Dairy  Course 
or  its  equivalent  to  continue  practical  work  in  special  lines.  The  University 
makes  no  charge  for  this  instruction,  nor  will  it  pay  anything  to  the  pupil  for 
the  work  he  may  do. 


APPENDIX.  551 

ADWIXCKD  DAI  Hi'  IXSTRUCTION. 

Work  in  the  follow ing  lines  is  offered  to  students  whose  previous  training, 
as  determined  by  examinations,  enables  them  to  carry  on  advanced  work 
advantageously. 

The  aim  of  the  advanced  course  is  to  prepare  the  student  for  the  duties  of 
instructor  in  dairying  or  to  assume  responsible  positions  in  advanced  practical 
dairy  lines. 

Dairy  Bacteriology,  by  Dr.  H.  L.  Eussell.  This  course  begins  at  the 
opening  of  the  university  year,  Sept.  29,  1898,  and  continues  uTitil  March, 
1899.  It  will  consist  largely  of  laboratory  work  supplemented  with  lectures 
and  collateral  reading.  Only  students  thoroughly  familiar  with  the  compound 
microscope  will  be  admitted. 

The  fee  for  this  course  is  $8.00,  which  covers  use  of  microscope  and  cost 
of  materials. 

Dairy  Chemistry,  by  Dr.  S.  M.  Babcock.  Laboratory  instruction  in 
chemical  analysis  of  dairy  products.  Previous  training  in  chemical  manipu- 
lation will  be  required  of  students  admitted  to  this  course.  This  instruction  is 
given  from  the  close  of  the  Dairy  School  term  until  July.  The  fee  for  this 
course  is  $5.00. 

Experimental  Dairying,  by  Prof.  E.  H.  Farrington.  Experiments  of 
various  kinds  are  in  progress  at  all  times.  Students  who  have  had  sufficient 
training  will  be  allowed  to  take  part  in  this  work,  which  includes  tests  of 
various  machines,  apparatus,  and  methods, 

DAIRY  CERTIFICATES. 

To  secure  a  dairy  certificate  the  candidate  must  have  spent  a  full  term  with 
us  and  passed  a  satisfactory  examination  in  all  the  sub-courses.  A  standing 
below  sixty  in  any  one  examination  makes  the  student  ineligible  to  a  dairy 
certificate.  Further,  be  must  have  worked  in  a  creamery  or  cheese  factory  foV 
two  seasons  of  not  less  than  seven  months  each.  One  of  these  seasons  must 
follow  the  period  spent  with  us,  and  during  this  time  the  candidate  must  have 
practical  charge  of  the  factory  in  which  he  is  working.  He  will  report  the 
operations  of  his  factory  monthly,  or  as  often  as  directed,  on  proper  blanks 
furnished  by  the  university.  The  university  holds  the  right  to  send  an 
authorized  person  to  inspect  the  factory  of  the  candidate,  and  no  certificate 
will  be  issued  if  an  unfavorable  report  is  made  by  the  inspector.  If  all  of  the 
conditions  are  satisfactorily  complied  with,  the  candidate  will  receive  a  dairy 
certificate.  Owing  to  the  expense  of  inspection,  the  university  does  not  agree 
to  grant  certificates  to  students  operating  factories  in  other  states. 

II.     SHORT  COURSES  IN  AGRICULTURE. 

Many,  and  perhaps  most  of  the  Agricultural  Colleges  have  what  are  termed 
"Short  Courses  in  Agriculture."  These  short  courses  are  intended  for  the 
benefit  of  ambitious  young  (and  old)  men  and  women  who  feel  the  need  of 
more  knowledge  than  they  possess,  and  yet  do  not  expect  to  take  a  full  college 
course.  They  are  usually  planned  either  for  one  or  two  terms  of  three  or  four 
months.  The  terms  usually  begin  in  November  and  end  in  March.  "Two- 
year  courses"  usually  mean  two  terms  attended  in  successive  years.  There 
are  no  entrance  examinations  and  no  educational  requirements  for  admission 
except  a  common-school  education  and  sufficient  maturity  to  enable  the  student 
to  deal  with  the  subject  presented.  In  some  states  they  are  largely  attended, 
and  students  with  gray  hair  and  spectacles  are  not  at  all  uncommon. 

The  courses  vary  greatly,  according  to  the  requirements  of  the  agricultural 
industries  of  the  state  and  the  equipment  of  the  college.     In  a  great  dairy  state 


652  APPENDIX. 

that  industry  would  be  made  most  prominent,  and  in  a  stock-raising  state  the 
kindred  industry  of  cattle  breeding  and  management,  while  in  grain-growing 
and  horticultural  stales  those  interests  would  appear  most  prominently.  It  is 
therefore  not  desirable  to  give  any  actual  course,  lest  it  should  be  misunderstood 
by  the  casual  reader  to  be  the  usual  course,  when,  as  a  matter  of  fact,  there  may 
be  no  two  colleges  in  the  country  which  give  the  same  course.  The  proper 
thing  is  for  any  one  desiring  to  take  a  short  course  in  the  university  to  address 
the  director  of  the  Experiment  Station  of  his  state,  who  is  always  connected 
with  the  Agricultural  College,  and  usually  the  head  of  it,  and  ascertain  what 
course  is  offered.  Instruction  is  usually  free  to  residents  of  the  state.  In 
California,  and  perhaps  other  states,  no  regular  "  short  course  "  is  announced, 
but  any  student  is  welcome  to  come  at  any  time,  take  whatever  studies  he 
desires  and  is  prepared  for,  and  leave  when  he  chooses,  or  when  he  must. 

The  subjects  most  suitable  for  a  general  short  course  are  Agricultural 
Physics,  including  not  only  the  physics  of  the  soil,  but  the  principles  affecting 
the  draft  of  wagons  and  machinery,  the  building  of  country  roads,  wells, 
pumps,  and  windmills,  construction  of  silos,  and  the  like. 

Plant  Life  is  a  fundamental  topic,  including  seed  and  its  germination  and 
all  the  process  of  growth. 

Plant  Pathology  logically  follows  the  study  of  plant  life,  dealing,  as  it 
does,  with  diseases  of  plants,  and,  usually,  their  remedies. 

Breeding  and  Judging  Live  Stock  of  all  kinds  is  a  usual  topic,  together 
with 

Feeds  and  Feeding,  in  which  the  student  learns  the  principles  of  animal 
nutrition,  and  the  science  of  feeding  in  such  a  manner  as  to  derive  most  profit 
from  the  outlay. 

Veterinary  Science  is  naturally  included  in  a  study  of  the  care  of  live 
stock,  and  usually  forms  part  of  a  short  course.  A  two-year  (two-term)  course 
would  usually  include  lectures  in 

Agricultural  Chemistry,  of  which,  in  any  case,  the  student  would 
absorb  a  good  deal. 

The  Economics  of  Agriculture  is  included  in  the  short  course  of  one 
university,  and  is  likely  to  appear  in  more.  It  deals  with  such  topics  as  are 
discussed  in  this  volume. 

In  different  colleges,  as  already  stated,  different  topics  are  included.  Among 
them  are  such  subjects  as  Farm  Mechanics,  Dairying,  Bacteriology,  Farm 
Bookkeeping,  Organization  of  Farms,  Entomology,  and  the  like. 

No  one  should  imagine  that  in  a  course  of  two  terms  it  is  possible  to  obtain 
any  great  mastery  of  any  of  these  subjects.  But  the  student's  eyes  will  be 
opened.  He  will  breathe  the  university  air.  He  will  be  inspired  by  contact 
with  earnest  and  wise  men.  He  will  begin  to  learn  how  to  think,  and  how  to 
investigate,  and  if  there  is  anything  in  him  of  value,  he  will  be  made  a 
student  for  the  rest  of  his  life. 


Appendix    C. 


AGRICULTURAL   EDUCATION    IN    THE    COMMON    SCHOOLS 
OF   NEW    YORK. 


The  beginnings  of  systematic  instruction  in  agriculture  in  the  common 
schools  of  New  York  is  unique  in  that  it  resulted  from  a  popular  movement 
originated  and  carried  through  hy  the  farmers  themselves.  Such  movements 
seldom,  if  ever,  crystallize  into  law,  unless  actively  promoted  by  those  interested. 
This  involves  not  merely  the  adoption  of  "resolutions,"'  which  cost  nothing, 
but  the  sending  of  some  qualified  person  to  the  capital  of  the  state  during  the 
session  of  the  Legislature,  to  press  it  upon  the  attention  of  members  of  that 
body  until  the  necessary  votes  are  secured.  This  costs  money,  unless  some 
public-spirited  person  is  found  able  and  willing  to  serve  at  his  own  expense, 
and  it  is  greatly  to  the  credit  of  western  New  York  that  they  originated  the 
plan  and  sent  their  agent  to  Albany  to  attend  to  the  passage  of  the  law. 
As  first  enacted  the  law  was  local,  appropriating  a  comparatively  small  sum  to 
be  expended,  at  the  discretion  of  Cornell  University.  The  language  of  the  first 
act  was  substantially  the  same,  in  this  respect,  as  that  of  the  law  of  1899,  which 
is  given  below.  This  general  language  left  the  university  free  to  use  its  judg- 
ment as  to  methods,  and  the  fii'st  work  was  avowedly  experimental.  The  suc- 
cess, however,  was  so  immediate  and  marked  that  after  the  first  j'ear  or  two 
the  appropriation  was  largely  increased,  and  was  directed  to  be  expended 
"throughout  the  state,"  as  expressed  in  the  act  of  1899,  which  is  here  printed 
as  a  model  for  farmers  in  other  states  to  work  for.  Its  great  value  is  that  it 
leaves  the  university  authorities  untrammeled.  Conditions  in  difierent  states 
will  seldom  be  the  same,  and  it  is  wisest  to  leave  the  university  authorities  free 
to  deal  with  whatever  conditions  may  exist,  they  being  held  responsible  that 
interest  among  farmers  shall  be  actually  awakened,  and  agricultural  instruction 
actually  brought  to  the  homes  of  the  people.  As  the  result  of  the  New  York 
law,  the  director  of  the  Cornell  Station  lately  wrote  me  that  the  station  was 
directly  influencing  more  than  200,000  persons. 

THE  NEW  YORK  LAW. 

The  people  of  the  state  of  New  York,  represented  in  Senate  and  Assembly, 
do  enact  as  follows : — 

Section  1.  For  the  promotion  of  agricultural  knowledge  throughout  the 
state,  the  sum  of  $35,000,  or  so  much  thereof  as  may  be  necessary,  is  hereby 

^553) 


554  APPENDIX. 

appropriated  out  of  any  money  in  the  treasury  not  otherwise  appropriated  to 
be  paid  to  the  College  of  Agriculture  at  Cornell  University,  to  be  expended  in 
giving  instruction  throughout  the  state  by  means  of  schools,  lectures,  and 
"     "  '         ■  "■   'n  conducting  investiga- 


other  university  extension  methods,  or  otherwise,  and  ir 
tions  and  experiments  ;  in  discovering  the  diseases  of  pi 


ants  and  remedies 


ascertaining  the  best  method  of  fertilization  of  fields,  gardens,  and  planta- 
tions ;  and  best  modes  of  tillage  and  farm  management  and  improvement  of 
live  stock  ;  and  in  printing  and  disseminating  agricultural  knowledge  by  means 
of  lectures  or  otherwise;  and  in  preparing  and  printing  for  free  distribution 
the  results  of  such  investigations  and  experiments  ;  and  for  republishing  such 
bulletins  as  may  be  useful  in  the  furtherance  of  the  work  ;  and  such  other 
information  as  may  be  deemed  desirable  and  profitable  in  promoting  the  agri- 
cultural interests  of  the  state.  Such  College  of  Agriculture  may,  with  the 
consent  and  approval  of  the  commissioner  of  agriculture,  employ  teachers  and 
experts  and  necessary  clerical  help  to  assist  in  carrying  out  the  purposes  of  this 
bill.  Such  teachers,  experts,  and  clerical  help  may  be  removed  by  the  College 
of  Agriculture  in  its  discretion  ;  and  may  be"  paid  for  their  services  such  sura 
or  sums  as  may  be  deemed  reasonable  and  proper  and  as  shall  be  approved  by 
the  commissioner  of  agriculture.  All  of  such  work  by  such  teachers  and 
experts  who  shall  be  em'ployed  under  this  bill  shall  be  under  the  general  super- 
vision and  direction  of  the  commissioner  of  agriculture.  The  sum  appropriated 
by  this  act  shall  be  paid  by  the  treasurer  of  the  state  upon  the  warrant  of  the 
comptroller  to  the  treasurer  of  Cornell  University,  upon  such  treasurer  filing 
with  the  comptroller  a  bond  in  such  sum  and  with  such  sureties  as  the  comp- 
troller my  approve,  conditioned  for  the  faithful  application  of  such  sum  to  the 
purposes  for  which  the  same  is  hereby  appropriated.  Such  sum  shall  be  payable 
by  the  treasurer  of  Cornell  University  upon  vouchers  approved  by  the  officers 
or  agents  of  such  university  having  charge  of  such  College  of  Agriculture,  and 
such  vouchers  shall  be  filed  by  the  treasurer  of  Cornell  University  in  the  office 
of  the  comptroller  of  the  state. 

Sec.  2.  This  act  shall  take  effect  immediately. 

[This  act  is  renewed  every  year.] 

II.       HELPS    FOR    TEACHERS. 

Under  this  law  actual  university  work  is  being  carried  directly  to  the 
homes  of  the  farmers  of  JSTew  York.  This  is  done  partly  by  means  of  "  itiner- 
ant schools,"  conducted  for  a  day  or  two  at  a  time  in  rural  sehool-houses  or 
elsewhere,  by  competent  persons  sent  out  by  the  university.  The  necessity  of 
this  work  will  tend  to  disappear  as  rural  teachers  become  better  qualified  for 
the  work.  As  an  aid  to  teachers  in  qualifying  themselves  the  university  from 
time  to  time  issues  "  leaflets,"  some  of  which  describe  the  nature  of  the  work  to 
be  done,  while  others  give  sample  lessons  in  full.  I  give  examples  of  both 
classes  of  the  leaflets,  which  are,  of  course,  intended  for  teachers,  although  they 
will  do  the  pupils  no  harm. 

1.       A    DESCRIPTIVE     LEAFLET. 

[This  leaflet  is  entitled  "  Teacher's  Leaflet,  No.  6,"  and  was  issued  by  the 
College  of  Agriculture,  Cornell  University,  May  10,  1898.] 

WHAT  IS   NATURE  STUDY? 

UY    L.    II.    15AILEY, 

It  is  seeing  the  things  which  one  looks  at,  and  the  drawing  of  proper  con- 
clusions from  what  one  sees.     Nature  study  is  not  the  study  of  a  science,  as  of 


APPENDIX.  555 

botany,  entomology,  geology,  and  the  like.  That  is,  it  takes?  the  things  at 
hand  and  endeavors  to  understand  them,  without  reference  to  the  systematic 
order  or  relationships  of  the  objects.  It  is  wholly  informal  and  unsystematic, 
the  same  as  the  objects  are  which  one  sees.  It  is  entirely  divorced  from  defini- 
tions, or  from  explanations  in  books.  It  is,  therefore,  supremely  natural.  It 
simply  trains  the  eye  and  the  mind  to  see  and  to  comprehend  the  common 
things  of  life  ;  and  the  result  is  not  directly  the  acquirement  of  science  but  the 
establishing  of  a  living  sympathy  with  everything  that  is. 

The  proper  objects  of  nature  study  are  the  things  which  one  oftenest  meets. 
To-day  it  is  a  stone;  to-morrow  it  is  a  twig,  a  bird,  an  insect,  a  leaf,  a  flower. 
The  child,  or  even  the  high-school  pupil,  is  first  interested  in  things  which  do 
not  need  to  be  analyzed  or  changed  into  unusual  forms  or  problems.  There- 
fore, problems  of  chemistry  and  of  physics  are  for  the  most  part  unsuited  to 
early  lessons  in  nature  study.  Moving  things,  as  birds,  insects  and  mammals, 
interest  children  most  and  therefore  seem  to'be  the  proper  subjects  for  nature- 
study  ;  but  it  is  often  ditficult  to  secure  specimens  when  wanted  especially  in 
liberal  quantity,  and  still  more  diflacult  to  see  the  objects  in  perfectly  natural 
conditions.  Plants  are  more  easily  had,  and  are,  therefore,  more  practicable 
for  the  purpose,  although  animals  and  minerals  should  by  no  means  be 
excluded. 

If  the  objects  to  be  studied  are  informal,  the  methods  of  teaching  should  be 
the  same.  If  nature  study  were  made  a  stated  part  of  a  curriculum,  its  pur- 
pose would  be  defeated.  The  chiefest  difficulty  with  our  present  school  methods 
is  the  necessary  formality  of  the  courses  and  the  hours.  Tasks  are  set,  and 
tasks  are  always  hard.  The  only  way  to  teach  nature  study  is,  with  no  course 
laid  out,  to  bring  in  whatever  object  may  be  handy  and  to  set  the  pupils  to 
looking 'at  it.  The  pupils  do  the  work,— they  see  the  thing  and  explain  its 
structure  and  its  meaning.  The  exercise  should  not  be  long,  not  to  exceed 
fifteen  minutes  at  any  time,  and,  above  all  things,  the  pupil  should  never  look 
upon  it  as  a  recitation,  and  there  should  never  be  an  examination.  It  should 
come  as  a  rest  exercise,  whenever  the  pupils  become  listless.  Ten  minutes  a 
day,  for  one  term,  of  a  short,  sharp,  and  spicy  observation  upon  plants,  for 
example,  is  worth  more  than  a  whole  text-book  of  botany. 

The  teacher  should  studiously  avoid  definitions,  and  the  setting  of  patterns. 
The  old  idea  of  the  model  flower  is  a  pernicious  one,  simply  because  it  does  not 
exist  in  nature.  The  model  flower,  the  complete  leaf,  and  the  like,  are  infer- 
ences, and  pupils  should  always  begin  with  things  and  not  with  ideas.  In 
other  words,  the  ideas  should  be  suggested  by  the  things,  and  not  the  things  by 
the  ideas.  "Here  is  a  drawing  of  a  model  flower,"  the  old  method  says  ;  "go 
and  find  the  nearest  approach  to  it."  "Go  and  find  me  a  flower,"  is  the  true 
method,  "  and  let  us  see  what  it  is." 

Every  child,  and  every  grown  person  too,  for  that  matter,  is  interested  in 
nature  study,  for  it  is  the 'natural  method  of  acquiring  knowledge.  The  only 
difficulty  lies  in  the  teaching,  for  very  few  teachers  have  had  any  drill  or  experi- 
ence in  this  informal  method  of  drawing  out  the  observing  and  reasoning 
powers  of  the  pupil  wholly  without  the  use  of  text-books.  The  teacher  must 
first  of  all  feel  the  living"  interest  in  natural  objects  which  it  is  desired  the 
pupils  shall  acquire.  If  the  enthusiasm  is  not  catching,  better  let  such  teach- 
ing alone. 

All  this  means  that  the  teacher  will  need  helps.  He  will  need  to  inform 
himself  before  he  attempts  to  inform  the  pupil.  It  is  not  necessary  that  he 
become  a  scientist  in  order  to  do  this.  He  simply  goes  as  far  as  he  knows,  and 
then  says  to  the  pupils  that  he  can  not  answer  the  questions  which  he  can  not. 
This  at  once  raises  his  estimation  in  the  mind  of  the  pupil,  for  the  pupil  is 
convinced  of  his  truthfulness,  and  is  made  to  feel — but  how  seldom  is  the 
sensation  ! — that  knowledge  is  not  the  peculiar  property  of  the  teacher^  but  is 
the  right  of  any  one  who  seeks  it.  It  sets  the  pupil  investigating  for  himself. 
The  teacher  never   needs   to  apologize  for  nature.      He  is  teaching  simply 


556 


APPENDIX. 


because  he  is  an  older  and  more  experienced  pupil  than  his  pupil  is.  This  is 
just  the  spirit  of  the  teacher  in  the  universities  to-day.  The  best  teacher  is 
the  one  whose  pupils  farthest  outrun  him. 

In  order  to  help  the  teacher  in  the  rural  schools  of  New  York,  we  have 
conceived  of  a  series  of  leaflets  explaining  how  the  common  objects  can  be 
made  interesting  to  children.  Whilst  these  are  intended  for  the  teacher,  there 
is  no  harm  in  giving  them  to  the  pupil  ;  but  the  leaflets  should  never  be  used 
as  texts  to  make  recitations  from.  Now  and  then,  take  the  children  for  a 
ramble  in  the  woods  or  fields,  or  go  to  the  brook  or  lake.  Call  their  attention 
to  the  interesting  things  which  you  meet — whether  you  yourself  understand 
them  or  not — in  order  to  teach  them  to  see  and  to  find  some  pnint  of  sympathy  ; 
for  every  one  of  them  will  some  day  need  the  solace  and  the  rest  which  this 
nature  love  can  give  them.  It  is  not  the  mere  information  which  is  valuable  ; 
that  may  be  had  by  asking  some  one  wiser  than  they,  but  the  inquiring  and 
sympathetic  spirit  is  one's  own. 

The  pupils  will  find  their  lessons  easier  to  acquire  for  this  respite  of  ten 
minutes  with  a  leaf  or  an  insect,  and  the  school-going  will  come  to  be  less 
perfunctory.  If  you  must  teach  drawing,  set  the  picture  in  a  leaflet  before  the 
pupils  for  study,  and  then  substitute  the  object.  If  you  must  teach  composi- 
tion, let  the  pupils  write  upon  what  they  have  seen.  After  a  time,  give  ten 
minutes  now  and  then  to  asking  the  children  what  they  saw  on  their  way  to 
school. 

Now,  why  is  the  College  of  Agriculture  of  Cornell  University  interesting 
itself  in  this  work?  It  is  trying  to  help  the  farmer,  and  it  begins  with  the 
most  teachable  point, — the  child.  The  district  school  can  not  teach  agriculture 
any  more  than  it  can  teach  law  or  engineering  or  any  other  profession  or  trade, 
but  it  can  interest  the  child  in  nature  and  in  rural  problems  and  thereby  fasten 
its  sympathies  to  the  country.  The  child  will  teach  the  parent.  The  coming 
generation  will  see  the  result.  In  the  interest  of  humanity  and  country,  we 
ask  for  help. 


II. 


A    SAMPLE    LESSON. 


[This  is  entitled  "Teacher's  Leaflet  No.  1,"  and  was  issued  by  the  College 
of  Agriculture,  Cornell  University,  May  10,  1898.] 

Note.— These  leaflets  are  intended  for  the  teacher,  not  for  the  scholars.  It  is  their 
purpose  to  suggest  the  method  which  a  teacher  may  pursue  in  instructing  children  at 
odd  times  in  nature  study.  The  teacher  should  show  the  children  the  objects  them- 
selves,—sluiuld  phuit  tlie  seeds,  raise  the  j. hints,  collect  the 
etc.;  or,  better,  he  sliould  interest  the  cliildren  tocdUeet  tlie 
Advanced  pupils,  however,  may  be  given  tlie  leutlets  aiu 
to  perform  the  experiments  or  make  tlie  (ibseivatKins  wh 
suggested.  The  scholars  themselves  slionld  be  tmiKhi  todn  i! 
and  to  arrive  at  independent  conclusions.  Teaelieis  wlm  .1 
inform  themselves  more  fully  upon  the  motives  of  this  iiiitiii 
teaching,  should  write  for  a  copy  of  Bulletin  V22  ul  the  Cur 
periment  Station,  Ithaca,  N.  Y. 


HOW  A  SQUASH  GETS  OUT  OF  THE  SEED. 

BY    L.    H.   BAILEY. 

If  one  were  to  plant  seeds  of  a  Hubbard  or  Boston  Marrow 
squash  in  loose  warm  earth  in  a  pan  or  box,  and  were  then  to 
leave  the  parcel  for  a  week  or  ten  days,  he  would  find,  upon 
his  return,  a  colony  of  plants  like  that  shown  in  Fig.  1.  If  he 
had  not  planted  the  seeds  himself  or  had  not  seen  such  plants 
before,  he  would  not  believe  that  these  curious  plants  would 
ever  grow  into  squash  vines,  so  ditterent  are  they  from  the 
vines  which  we  know  in  the  garden.     This,  itself,  is  a  most 


I.      Squash 
plant  a  week 


APPENDIX. 


557 


3.  Germination  just 
beginning. 


2.  Squash  plant 
TV  k  i  ch  has 
brought  the 
seed-coats  out 
of  the  ground. 


curiou-^  fact  —this  wonderful  difference  between  the  first  and  the  later  stage 
of  all  plants,  and  it  is  only  because  we  know  it  so  well  that  we  do  not  wonder 

''    '  ■  It  may  happen,  however — as  it  did  in  a  pan  of  seed  which 

I  sowed  a  few  days  ago— that  one  or  two  of  the  plants  may 
look  like  that  shown  in  Fig.  2.  Here  the  seed  seems  to  have 
coine  up  on  the  top  of  the  plant,  and  one  is  reminded  of 
the  curious  way  in  which  beans  come  up  on  the  stalk  of  the 
young  plant.  If  we  were  to  study  the  matter,  however— as 
we  may  do  at  a  future  time— we  should  find  a  great  differ- 
ence in  the  ways  in  which  the  squashes  and  the  beans  raise 
their  seeds  out  of  the  ground.  It  is  not  our  purpose  to  com- 
pare the  squash  and  the  bean  at  this  time,  but  wo  are  curious 
to  know  why  one  of  these  squash  plants  brings  its  seed  up 
out  of  the  ground  whilst  all  the  others  do  not.  In  order 
to  find  out  why  it  is,  we  must  ask  the  plant,  and  this  asking 
is  what  we  call  an  experiment. 

We  may  first  pull  up  the  two  plants.  The  first  one 
(Fig.  1)  will  be  seen  to  have  the  seed  coats  still  attached  to 
the  very  lowest  part  of  the  stalk  below 
the  soil,  but  the  other  plant  has  no  seed 
at  that  point.  We  will  now  plant  more 
seeds,  a  dozen  or  more  of  them,  so  that 
we  shall  have  enough  to  examine  two  or 
three  times  a  day  for  several  days.     A  day 

or  two  after  the  seeds  are  planted,  we  shall  find  a  little  point 
or  root-like  portion  breaking  out  of  the  sharp  end  of  the  seed, 
as  shown  in  Fig.  3.     A  day  later  this  root  portion  has  grown 
to'  be  as  long  as  the  seed    itself  (Fig.   4),   and 
it  has   turned  directly  downwards   into  the  soil. 
But  there  is    another  most  curious  thing   about 
this  germinating  seed.      Just  where   the  root  is 
breaking  out  of  the  seed  (shown  at  a  in  Fig.  4), 
there    is  a  little  peg  or  projection.     In  Fig.   5, 
about  a  day  later,  the  root  has  grown  still  longer, 
and  this   peg   seems   to  be  forcing  the 
seed  apart,   "in  Fig.  6,  however,  it  will 
be  seen  that  the  seed   is   really  being 
forced  apart  by  the  stem  or  stalk  above 
the    peg,    for  this  stem    is   now    grow- 
ing longer.     The  lower  lobe  of  the  seed 
ha's    attached  to    the   peg    (seen   at  a, 
Fitr.  6),  and  the  seed  leaves  are  trying 

to  back  out  of  the  seed.  Fig.  7  shows  the  seed 
still  a  dav  later.  The  root  has  now  produced 
many  branches  and  has  thoroughly  established 
itself  in  the  soil.  The  top  is  also  growing  rapidly 
and  is  still  backing  out  of  the  seed,  and  the 
seed  coats  are  still  firmly  held  by  the  obstinate 

"whilst  we  have  been  seeing  all  these  curi- 
ous things  in  the  seeds  which  we  have  dug  up, 
the  plantlcts  which  we  have  not  disturbed  have  been  coming 
through  the  soil.  If  we  were  to  see  the  plant  in  Fig.  7,  as 
it  was  "coming  up,"  it  would  look  like  Fig.  8.  It  is 
tuo-ging  awav  trying  to  get  its  head  out  of  the  bonnet  which 
^  down  underneath  the  soil,  and  it  has  "got  its  back 
up'"  m  the  operation.  In  Fig.  9  it  has  escaped  from  its  trap 
and  it  is  laughing  and   growing   in   delij 


4.     The  root 

and  peg. 


rht. 


It  must   now 


558 


APPENDIX. 


8.     The    plant  just, 
coming  up. 


JO.       The    plant 
.straightening  up. 


Strengthen  itself  up,  as  it  is  doing  in  Fig.  10, 
and  it  is  soon  standing  proud  and  straight,  as 
in  Fig.  1.  We  now  see 
that  the  reason  why  the 
seed  came  up  on  the  plant 
in  Fig.  2  is  because  in 
some  way  the  peg  did  not 
hold  the  seed  coats  down 
(see  Fig.  13),  and  the 
expanding  leaves  are 
pinched  together,  and 
they  must  get  themselves  loose  as  best  they  can. 

There  is  another  thing  about  this  curious  squash  plant 
which  we  must  not  fail  to  notice,  and  this  is  the  fact  that 
these  first  two  leaves  of  the  plantlet  came  out  of  the  seed 
and  did  not  grow  out  of  the  plant  itself.  We  must 
notice,  too,  that  these  leaves  are 
much  smaller  when  they  are  first 
drawn  out  of  the  seed  than  they 
are  when  the  plantlet  has  straight- 
ened itself  up.  That  is,_  these 
leaves  increase  very  much  in  size 
after  they  reach  the  light  and  air. 
The  roots  of  the  plantlet  are  now 
established  in  the  soil  and  are  tak- 
ing in  food  which  enables  the  plant 
to  grow.  The  next  leaves  which 
appear  will  he  very  different  from 
these  first  or  seed  leaves. 

These  later  ones  are  called  the  true  leaves.  They 
grow  right  out  of  the  little  plant  itself.  Fig.  11  shows 
these  true  leaves  as  they  appear  on  a  young  crookneck 
squash  plant,  and  the  plant  now  begins  to  look  much  like 
a  squash  vine. 
We  are  now 
curious  to  know 
how  the  stem 
grows  when  it 
backs  out  of  the 
seeds   and   pulls 

the  little  seed  leaves  with  it, 
and  how  the  root  grows 
downwards  into  the  soil. 
Now  let  us  pull  up  another 
seed  when  it  has  sent  a  single 
root  about  two  inches  deep 
into  the  earth.  We  will 
wash  it  very  carefully  and 
lay  it  upon  a  piece  of  paper.  Then  we 
win  lay  a  ruler  alongside  of  it,  and  make 

an  ink  mark  one-quarter  of  an  inch  from  the  tip,  and  two  or 
three  other  marks  at  equal  distances  above  (Fig.  12).*  We  will 
now  carefully  replant  the  seed.     Two  days  later  we  will  dig   it 


The  plant  liber- 
ated J  rom  the  seed- 
coats. 


•  NOTE  -Common  ink  will  not  answer  for  this  purpose  because  it  'runs  ^^^en  the  root 
is  wet  but  indelible  ink,  used  for  marking  linen  or  for  drawing,  should  be  used.  It  should 
ilsHe  said  that  the  root  of  the  commou  pumpkin,  and  of  the  summer  bush  squasncs,  is 
roo°fib?o?fs1nd  branchTfor  this  test.  It  s^^LA  ^^f.^'t?;'  tat'uieTe\im1n°.iS^^^^^ 
of  ita  vorv  tin  hill  f  hipHv  lu  a  uaffow  zoue  lust  back  of  the  tip  but  tne  aeterminaiion  oi 
thifp^fnf  is  father  too  dffficuH  for  the  beglu^ier,  and,  moreover,  it  is  foreign  to  th^purpose 
of  this  tract. 


APPENDIX. 


559 


up,  when  we  shall  most  likely  find  a  condition  something  like  that  in  Fig. 
13.  It  will  be  seen  that  the  marks  E,  C,  B,  are  practically  the  same  dis- 
tance apart  as  before,  and  they  are  also  the  same  distance  from  the  peg  AA. 
The  point  of  the  root  is  no  longer  at  DD,  however,  but  has  grown  on  to  F. 
The  root,  therefore,  has  grown  almost  wholly  in  the  end  portion. 

Now    let  us  make  a  similar  experiment  with  the  stem  or  stalk.     We  Avill 


13,    The  root  grows  in  the  end 
portions. 


The  marking  of  the  stem,  and  the  spreading apatt 
of  the  marks. 


mark  a  young  stem,  as  at  A  in  Fig.  14;  but  the  next  day  we  shall  find  that 
these  marks  are  farther  apart  than  when  we  made  them  (B,  Fig.  14).  The 
marks  have  all  raised  themselves  above  the  ground  as  the  plant  has  grown. 
The  stem,  therefore,  has  grown  between  the  joints  rather  than  from  the  tip. 
The  stem  usually  grows  most  rapidly,  at  any  given  time,  at  the  upper  or 
younger  portion  of  the  joint  (or  internode) ;  and  the  joint  soon  reaches  the 
limit  of  its  growth  and  becomes  stationary,  and  a  new  one  grows  out  above  it. 

Natural  science  consists  in  two  things, — seeing  lohat  you  look  at,  and  drawing 
proper  conclusions  from  what  you  see. 


Of  course  it  will  be  understood  that  the  idea  of  "nature  study"  did  not 
originate  at  Cornell  University.  Nature  study  has  been  the  dream  of  the  best 
teachers  for  a  century,  and  perhaps  always,  and  of  late  years  is  made  prominent 
in  all  the  best  schools.  Its  value  as  a  preparation  for  life  on  the  farm  is  also 
sufliciently  obvious,  and  was  pointed  out  long  before  Cornell  University  took 
up  the  work.  The  credit  due  to  Cornell  University  is  that  of  being  the  first  to 
actually  carry  out  the  work  on  a  great  scale,  and  of  putting  U   in  forms  so 


560  APPENDIX. 

attractive  and  clear  as  to  at  once  excite  interest  and  carry  conviction.  I  do 
not  know,  in  history,  of  any  other  such  success  in  popularizing  the  best  form 
of  educational  work. 

In  addition  to  this  work  carried  on  directly  with  the  common  schools,  a 
farmers'  reading  course  was  established,  on  the  "  Chautauqua  plan,"  which,  in 
1898,  had  a  membership  of  four  thousand  eight  hundred,  and  was  rapidly 
increasing.  This  course  occupies  four  winters,  and  leads  to  a  certificate  to  all 
who  complete  the  course  and  pass  the  examinations.  In  this  way  real  univer- 
sity education  is  brought  to  the  very  doors  of  the  farmers.  An  interesting 
feature  of  the  Cornell  work  is  the  organization  of  children  of  rural  districts  into 
' '  Cornell  Junior  Nationalists'  Clubs, ' '  for  the  purpose  of  promoting  systematic 
study  of  natural  objects. 

While  Cornell  University,  as  the  leader  in  this  work,  is  entitled  to  the 
recognition  here  given,  it  must  not  be  supposed  that  it  is  any  longer  alone 
in  it.  Its  great  success  has  stirred  the  whole  country,  and  universities  and 
normal  schools  everywhere  are  every  day  putting  more  stress  not  only  upon 
nature  study,  but  upon  its  importance  as  a  foundation  for  successful  work  on 
the  farm.  The  facts  here  given  are  intended  as  a  stimulus  to  such  farmers  as 
may  see  them,  to  lead  them  to  appreciate  the  economic  value  of  the  work,  and 
aid  the  authorities  of  their  own  states  in  establishing  it  among  themselves,  or 
to  demand  it,  as  the  farmers  of  Western  New  York  did,  if  the  authorities  are 
not  acting. 


III.       AGRICULTURAL    EDUCATION    IN    FOREIGN    COUNTRIES. 

Space  permits  only  such  reference  to  agriculture  in  foreign  countries  as  may 
serve  to  disabuse  any  minds  of  the  impression  that  systematic  instruction  in 
agriculture  is  a  new  thing,  or  peculiar  to  the  United  States.  Although  we  are 
now  doing  more  in  this  direction  tban  any  other  country,  we  were  by  no  means 
the  earliest  in  the  field.  Agricultural  instruction  in  schools  of  all  grades  dates 
back,  in  several  countries  of  Europe,  to  the  early  part  of  the  nineteenth 
century,  and  perhaps  longer.  On  the  continent  of  Europe  there  is  perhaps  no 
country  in  which  provision  is  not  made  for  agricultural  instruction  wholly,  or 
more  usually  partly,  at  public  expense,  and  in  many  it  begins  in  the  public 
schools.  Information  on  this  point  may  be  had  by  those  interested  in  the  later 
reports  of  the  United  States  Commission  of  Education,  nearly  all  of  which 
have  more  or  less  reference  to  the  subject.  These  reports  can  be  found  in  any 
considerable  public  library.  In  this,  as  in  other  respects,  each  country  de^  elops 
according  to  its  necessities  and  the  character  of  its  people.  The  principles 
involved  must  be  the  same  everywhere,  but  the  methods  both  of  procedure  and 
administration  will  differ.  For  Americans,  up  to  the  present  time,  the  best 
example  is  unquestionably  that  of  the  state  of  New  York,  and  naturally  so 
since  it  is  our  richest  state,  and  can  spend  most  money  in  this  direction.  Not 
all  our  states  can  yet  do  what  New  York  is  doing,  but  a  somewhat  careful 
study  of  whatever  I  have  been  able  to  find  as  to  agricultural  instruction  abroad 
suggests  nothing  of  value  for  imitation  which  will  not  be  found  in  the  work  of 
New  York  and  all  other  states  which  are  following  her  lead. 


Appendix    D 


I.      HOW     TO     OBTAIN     PUBLIC     DOCUMENTS. 

Agricultural  literature  is  of  three  kinds  : — 

1.  Elaborate  reports,  or  similar  documents,  usually  containing  exhaustive 
statements  of  facts,  with  statistical  tables,  diagrams,  maps,  and  more  or  less 
discussion.  The  preparation  of  such  papers  is  very  expensive,  owing  to  the 
great  amount  of  valuable  time  employed,  and  the  cost  of  the  experiments  or 
surveys  of  which  they  give  the  results.  Such  papers  are  properly  called 
"authorities,"  because  they  contain  the  results  of  original  research,  properly 
authenticated.  They  supply  the  facts  upon  which  discussion  proceeds.  The 
facts  contained  in  these  documents  would  never  be  collected  at  private  expense, 
nor  would  any  publishing  house  undertake  to  print  them.  They  are  almost 
exclusively  government  publications.  Very  valuable  statistics  are  gathered  by 
leading  trade  organizations  in  regard  to  prices  and  crops. 

This  most  expensive  of  all  literature  can  usually  be  had,  postage  free,  for 
the  asking,  provided  the  proper  authorities  are  satisfied  that  good  use  will  be 
made  of  what  is  asked  for.  The  editions,  however,  are  usually  limited.  Such 
books  can  usually  be  found  in  all  large  libraries. 

2.  Brief  monographs,  usually  called  "bulletins"  or  "circulars,"  giving 
the  gist  of  existing  information  on  a  single  topic,  and  usually  intended  for 
popular  reading.  The  most  notable  of  these  are  the  "Farmers'  Bulletins," 
published  by  the  United  States  Government  and  the  Bulletins  of  the  Experi- 
ment Stations.  Nearly  all  such  publications  can  be  obtained  free,  although 
some  of  those  published  by  the  United  States  are  sold  at  cost. 

State  publications  are  usually,  and  perhaps  always,  sent  free,  upon  applica- 
tion, to  residents  of  the  state.  Where  possible  state  officials  will  usually  send 
them  to  applicants  residing  in  other  states.  To  obtain  state  documents  it  is 
only  necessary  to  address  the  state  "bureau,"  "commission,"  "board,"  or 
"department,"  which  issues  them,  stating  what  is  desired.  It  is  not  necessary 
to  know  the  name  of  any  official,  although,  when  known,  it  may  be  used. 
The  address  of  these  bodies  is  nearly  always  at  the  capital  of  the  state.  It  is 
the  business  of  a  good  farmer  to  know,  as  to  his  own  state,  the  proper  titles  of 
the  officers  issuing  publications,  and  to  address  them  for  any  publication  desired. 

Experiment  Stations,  although  mainly  supported  by  the  United  States,  are 
considered,  in  respect  to  publications,  as  state  institutions.  They  are  under  no 
legal  obligation  to  send  their  publications  outside  the  states  in  which  they 
are  located,  and  a  few  of  them  are  rather  illiberal  in  that  respect.  For  the 
most  part,  however,  the  Experiment  Stations  send  their  publications  to  all 
applicants,  wherever  located.  All  Experiment  Stations,  probably,  keep  lists  of 
36  (561) 


5G2 


APPENDIX. 


addresses  of  farmers  within  the  state,  to  whom  the  station  publications  are 
mailed,  regularly,  as  they  appear,  and  without  application.  Any  one  may 
have  his  name  placed  on  that  list,  by  sending  it,  with  his  address,  to  the  station. 
Many  state  boards,  and  perhaps  all,  pursue  a  similar  course.  All  farmers 
should  get  their  names  onto  all  such  lists. 

In  writing  to  Experiment  Stations  for  publications,  or  for  information,  it  is 
always  as  well,  and  frequently  best,  to  use  no  name  of  any  official.  He  may 
be  absent,  or  have  left  the  institution,  and  the  letter  remain  a  long  time 
unanswered.  The  better  form  of  address  is,  "Director  U.  S.  Agricultural 
Exp.  Station." 

The  location  of  the  stations  does  not  change,  and  there  is  always  a  director. 
He  will  receive  the  letter,  and  send  the  publication  asked  for,  or,  if  it  is  a 
request  for  information,  refer  it  to  the  proper  member  of  the  staff  for  reply. 

The  following  is  a  list  of  the  United  States  Agricultural  Experiment 
Stations,  with  the  name  of  the  college  or  university  with  which  each  is 
connected. 


LOCATION   OF  EXPERIMENT  STATIONS  AND    AGRICULTURAL 
COLLEGES. 


Alabama 

Canebrake  Station 
Arizona  Sub-station 
Arkansas 
California 

Sub-stations 


Forestry  Stations 

Colorado 
Connecticut 


Post-office. 


Auburn 


Uniontown 
Tucson,  l^hoenix 
Fayetteville 
Berkeley 

5  Paso  Kobles 
Tulare 
Jackson 
Chino 
r  Ohico 

\  Santa  Monica 
Fort  Collins 
New  Haven 
Storrs 


Name  of  college  with  which 
station  is  connected. 

Agricultural     and     Mechanical 
College  of  Alabama. 

University  of  Arizona. 
Arkansas  Industrial  University. 
University  of  California. 


Agricultural  College  of  Coloradi 
Storrs  Agricultural  College. 


Delaware 

Florida 

Georgia 

Idaho 
Illinois 
Indiana 
Iowa 

Kansas 

Kentucky 


(These  stations  are  independent  of  each  other.) 

Newark  Delaware  College. 

Lake  City  Florida  Agricultural  College. 

Experiment  Georgia  State  College  of  Agri- 

culture and  Mechanic  Arts. 

Moscow  University  of  Idaho. 

Urbana  University  of  Illinois. 

Lafayette  Purdue  University. 

Ames  Iowa  State  College  of  Agricul- 

ture and  Mechanic  Arts. 

Manhattan  Kansas     State     Agricultural 

College. 

Lexington  Agricultural     and    Mechanical 

College  of  Kentucky. 


APPENDIX. 


563 


State. 

Louisiana 

No,   1,    Sugar  Exp. 
Station 

No.  2,  State  Exp. 

No.  3,  North  Louisiana 
Exp.  Station 
Maine 
Maryland 
Massachusett.s — 

(State  Station) 

Hatch  Station 


Audubon   Park, 
New  Orleans 
Uaton  llougc 

Calhoun 
Orono 
College  Park 


Name  of  college  with  which 
station  is  connected. 


I  Louisiana  State  University  and 
y  Agricultural  and  Mechanical 
i       College. 

]\[aine  State  College. 
Maryland  Agricultural  College. 


Michigan 

Minnesota 

Mississippi 


Amher.'it 
Amherst 

Agricultural  College 
St.  Anthony  Park 
Agricultural  College 


Missouri 

Columbia 

Montana 

Bozeman 

Nebraska 

Lincoln 

Nevada 

Keno 

New  Hampshire 

Durham 

New  Jersey — 

(State  Station) 

New  Brunswick 

(Ag.  College  Station) 

New  Brunswick 

New  Mexico 

Mesilla  Park 

New  York— 

(State  Station) 

Geneva 

(Cornell  Station) 

Ithaca 

North  Carolina 

Ealeigh 

North  Dakota 

Fargo 

Ohio 

Wooster 

Oklahoma 

Stillwater 

Oregon- 

Corvallis 

Pennsylvania 

State  College 

Khode  Island 

Kingston 

South  Carolina 

Clemson  College 

South  Dakota 

Brookings 

Tennessee 

Knoxville 

Texas 

College  Station 

Utah 

Logan 

Vermont 

Burlington 

Virginia 

Blackshurg 

Washington 

Pullman 

West  Virginia 

Morgan  town 

Wisconsin 

Madison 

Wyoming 

Laramie 

Massachusetts   Agricultural 
College. 

Michigan  Agricultural  College. 

University  of  Minnesota. 

Mississippi  Agricultural  and 
Mechanical  College. 

University  of  Missouri. 

Montana  Agricultural  College. 

University  of  Nebraska. 

Nevada  State  University. 

New  Hampshire  College  of 
Agriculture  and  the  Me- 
chanic Arts. 

At  Rutgers  College. 

Rutgers  College. 

New  Mexico  College  of  Agri- 
culture and  the  Mechanic 
Arts. 


Cornell  University. 

North  Dakota  Agricultural  Col. 

Oklahoma      Agricultural     and 

Mechanical  College, 
Oregon   State   Agricultural   Col. 
Pennsylvania  State  College. 
Rhode   Island   College   of  Agri- 
culture and  Mechanic  Arts. 
Clemson  Agricultural  College. 
South  Dakota    Agriculturar  Col. 
University  of  Tennessee. 
Agricultural     and      Mechanical 

College  of  Texas. 
Agricultural  College  of  Utah. 
University  of  Vermont. 
Virginia   Agricultural   and   Me- 
chanical College. 
Washington  Agricultural  Col. 
West  Virginia  University. 
University  of  Wisconsin. 
University  of  Wyoming. 


The  process  of  obtaining  United  States  publications  is  somewhat  less  gimple^ 
as  there  are  several  avenues  through  which  they  may  be  obtamed. 


564  APPENDIX. 

Publications  of  special  value  to  farmers  are  published  mainly  by  the  Depart- 
ments of  State,  the  Interior,  and  Agriculture. 

The  Department  of  State  issues  a  monthly  publication  called  "  Consular 
Keports."  It  is  regularly  sent,  free,  to  all  who  apply  for  it.  The  majority  of 
the  monthly  numbers  contain  matter  of  great  importance  to  farmers  in  the  way 
of  information  as  to  what  their  competitors  in  foreign  lands  are  doing.  To 
obtain  the  "Consular  Keports,"  address  Secretary  of  State,  Washington, 
D.  C,  and  ask  to  have  it  sent.  Be  sure  to  specify  ^'monthly  edition,"  as  there 
is  a  daily  edition  of  the  same  matter.  The  daily  edition  is  intended  for  editors 
and  is  not  in  form  for  preservation. 

The  Department  of  the  Interior  (Geological  Survey)  issues  reports  and 
papers  in  regard  to  water  supply  and  irrigation,  which  are  distributed  free. 
These  documents  must  be  applied  for,  by  title,  as  they  appear.  Address 
Secretary  for  the  Interior,  Washington. 

The  Department  of  Agriculture  publishes  a  great  number  of  documents  for 
farmers,  of  which  most  may  be  obtained,  free,  from  the  Secretary  of  Agri- 
culture or  Senators  and  Representatives  in  Congress.  Some,  however,  can  not 
be  obtained  free,  but  must  be  purchased  of  the  Superintendent  of  Public  Docu- 
ments. The  Department  of  Agriculture  issues  a  monthly  list  of  its  publica- 
tions. Any  person  can  have  this  document  mailed  to  him,  regularly,  upon 
application  to  the  Secretary.  This  is  the  only  document  of  the  Department  of 
Agriculture  regularly  mailed  free  to  anybody.  All  other  publications  must  be 
applied  for  by  title.  But  one  copy  of  any  document  will  be  mailed  to  a  single 
address. 

The  following  suggestions  will  be  found  useful  to  those  desiring  to  obtain 
the  publications  of  this  department : — 

(«)  Send  on  your  name  to  receive  the  "  Monthly  List  of  Publications." 

{d)  Apply  for  such  as  you  desire  as  soon  as  you  receive  the  list.  Editions 
are  often  small,  and  become  exhausted. 

(c)  If  ordering  of  the  Superintendent  of  Public  Documents,  do  not  send 
stamps  in  payment.  The  government  sells  stamps  but  does  not  buy  them 
back.     They  will  not  be  received  under  any  circumstances. 

{d)  The  "Year  Book"  of  the  Department  of  Agriculture  can  never  be 
obtained  of  the  department  by  individuals.  Apply  to  a  Senator  or  the  Repre- 
sentative from  your  congressional  district.     During  sessions  of  Congress,  they 

should  be  addressed  at  Washington.     Address  Hon. ,  Senate  Chamber 

(or  House  of  Representatives),  Washington,  D.  C.  When  Congress  is  not  in 
session  they  should  be  addressed  at  their  homes.  The  "  Farmers'  Bulletins," 
also,  are  mainly  distributed  *  by  Senators  and  Representatives,  although  these 
may  sometimes  be  obtained  from  the  department. 


♦This  distribution  of  documents  (and  seeds)  is  a  fine  example  of  the  manner  in 
which  "humbug"  is  employed  to  influence  farmers.  The  farmer  receives  a  bulky 
packiiKiS  under  tlio  "frank"  of  his  representative.  Mini  is  |ilease(l  to  know  that  the 
distiuKuislie.l  >,'eiiMeiiian  lias  liiiu  in  niin.l.  lie  easually  nienlions  the  fact  to  his 
friends,  and  is  iiieline.l  u>  the  Ijelief  tli.Ml  lli.\  leiv<' a  i,'"od  man  in  Wasliin.uton.  lie 
may  or  nniy  not  r(>ad  tlie  hooks  or  jilant  llie  see. Is.  As  a  matter  of  fact,  tlie  Congress- 
mail  has  probably  purchased  a  list  of  names  from  those  who  compile  them  for  sale  to 
other  advertisers,  and  which  his  clerk  sends  to  the  document  or  seed  room,  where  the 
clerks  send  out  what  he  orders  under  his  frank.    It  is  very  wasteful. 


APPENDIX.  565 

(e)  The  monthly  list  of  puhlications  always  tells  how  to  get  the  books  pub- 
lished in  the  month  of  its  issue.  There  is  no  way  to  find  out  how  to  get  older 
publications,  or  whether  any  have  been  issued  upon  any  subject,  or  whether  or 
where  they  can  be  had,  if  at  all,  except  to  write  to  the  Secretary  of  Agriculture 
and  ask. 

(/■)  Postage  must  be  paid  on  all  communications  addressed  to  government 
officials. 

The  following  is  the  official  statement  of  the  department  in  regard  to  its 
publications : — 

NOTES  REGARDING  DEPARTMENT  PUBLICATIONS. 

The  publications  of  the  United  States  Department  of  Agriculture  are  of 
three  classes:  (1)  Serial  publications;  (2)  scientific  and  technical  reports;  and, 
(3)  popular  bulletins. 

The  first  two  classes  are  issued  in  limited  editions  and  are  not  intended  for 
general  distribution,  being  particularly  designed  for  scientific  students  and  for 
libraries  and  institutions  of  learning.  They  are  distributed  free  to  persons 
cooperating  with  or  rendering  the  department  some  service.  Sample  copies 
will  be  sent  if  requested,  but  miscellaneous  applicants  should  apply  to  the 
Superintendent  of  Documents,  Union  Building,  Washington,  D.  C._,  to  whom 
all  publications  not  needed  for  official  use,  except  circulars  and  bulletins  printed 
by  law  for  free  distribution,  are  turned  over  in  accordance  with  the  following 
provision  of  the  act  providing  for  the  public  printing  and  binding  and  the 
distribution  of  public  documents,  viz.: 

Section  67.  All  documents  at  present  remaining  in  charge  of  the  several  Executive 
Departments,  bureaus,  and  offices  of  the  government  not  required  for  official  use,  shall 
be  delivered  to  the  Superintendent  of  Documents,  and  hereafter  all  public  documents 
accumulating  in  said  departments,  bureaus,  and  offices  not  needed  for  official  use  shall 
be  annually  turned  over  to  the  Superintendent  of  Documents  for  distribution  or  sale. 

The  Farmers'  Bulletins  treat  in  a  practical  manner  of  subjects  of  particular 
interest  to  fsvrmers,  and  are  issued  with  a  view  to  the  widest  possible  circulation. 
These  bulletins  and  circulars  of  information  are  free,  two-thirds  of  them  being 
set  aside  under  the  law  for  distribution  through  senators,  representatives,  and 
delegates  in  Congress.  Applications  may  be"  addressed  to  the  Secretary  of 
A"-riculture,  stating  both  the  number  and  tdlr.  of  the  publication  desired. 

"  The  department  has  no  list  t<J  whom  all  publications  are  sent;  the  variety  of 
the  subjects  treated  naturally  restricts  the  distribution  of  most  of  them  to  the 
sections  of  countrv  to  which  they  are  especially  suitable  and  to  specialists.  The 
Monthly  List  of  Publications,  issued  the  first  of  each  month,  will  be  mailed  to 
all  who  apply  for  it.  In  it  the  titles  of  the  publications  are  given,  witha  note 
explanatory  of  the  character  of  each,  thus  enabling  the  reader  to  make  intelli- 
gent application  for  such  bulletins  and  reports  as  are  certain  to  be  of  interest  to 
him. 

The  department  can  not  undertake  to  furnish  complete  sets  of  either  Farmers' 
Bulletins  or  other  publications. 

For  the  piiblications  of  the  Weather  Bureau,  requests  and  remittances  should 
be  directed  to  the  Chief  of  that  bureau. 

For  publications  mentioned  in  the  Monthhi  List  preceding,  to  irhich  a  price 
is  attcwhcd  (with  the  exception  of  those  issued  by  the  Weather  Bureau),  appli- 
cation must  be  made  to  the  Superintendent  of  Documents,  Union  Building, 
Washington,  D.  C. ,  accompanied  by  the  price  thereof  as  fixed  by  him  in  accord- 
dance  with  the  provisions  of  sections  61  and  67  of  the  act  providing  for  the 
public  printing  and  binding,  and  the  distribution  of  public  documents,  approved 
.January  12.  1895,  and  all"  remittances  should  be  made  to  him  and  not  to  the 
Department  of  Agriculture;  such  remittances  should  be  made  by  postal  money 
order  and  not  by  private  check  or  stamps. 


566  APPENDIX. 

The  Superintendent  of  Documents  is  not  permitted  to  sell  more  than  one 
copy  of  any  public  document  to  the  same  person. 

^The  Superintendent  of  Documents  is  not  an  official  of  the  Department  of 
Agriculture. 

Applications  for  all  other  publications  of  this  department  should  be  addressed 
to  the  Secretary  of  Agriculture,  Washington,  D.  C. 

Do  not  inclose  stamps  when  writing  to  the  department  about  publications; 
it  is  not  necessary  in  order  to  secure  a  reply. 

Please  advise  the  department  of  any  change  of  address. 

In  all  cities  where  there  are  free  or  other  large  public  libraries,  they  can, 
upon  establishing  their  standing  and  capacity  for  storage,  be  made  "deposi- 
tories" of  public  documents,  to  which  copies  of  all  publications  are  sent. 
Farmers  living  near  any  such  library,  or  in  most  cases  any  college  or  univer- 
sity, will  find  sets  of  public  documents. 

Granges,  or  other  organizations  of  farmers  whose  secretary  will  take  the 
trouble  to  keep  watch  of  what  the  government  or  state  publishes,  and  apply  for 
them  promptly,  may  very  soon  collect  an  exceedingly  valuable  library;  that  is, 
it  will  be  valuable  if  kept  strictly  for  reference,  properly  arranged  and  accessible. 
If  loaned  out  to  members,  who  can  each  get  the  books  for  themselves  by  apply- 
ing, they  will  be  scattered  and  lost.  If  piled  up  in  heaps  under  benches,  and 
covered  with  dust,  they  are  of  no  value.  It  will  not  pay  any  Grange  to  start 
a  reference  library  unless  it  is  certain  that  members  will  use  it.  A  reference 
library  involves  a  great  deal  of  work,  and  in  two  or  three  years,  may  come  to 
occupy  a  great  deal  of  space.  Some  one  must  be  in  charge  of  it,  know  what  is 
in  it,  and  where  to  look  for  what  is  wanted. 

The  state  and  United  States  publications  are  of  the  utmost  value  to  farmers, 
and  should  be  made  use  of. 

3.  The  third  class  of  books  for  farmers  includes  formal  treatises  on  such 
subjects  as  soils,  irrigation,  fertilizers,  fruit-growing,  dairying,  and  the  like,  and 
special  treatises  on  the  cultivation  of  different  crops,  as  tobacco,  cotton,  the 
sugar  beet,  etc.  This  class  of  subjects  is  fairly  well  covered  by  government 
bulletins  on  these  subjects,  but  to  the  real  student  no  brief  bulletin  can  take  the 
place  of  a  thorough  treatise.  The  bulletins  are  printed  and  distributed  at  public 
expense  because  it  is  in  the  public  interest  that  farmers  should  learn  how  to 
reduce  costs  of  production,  and  they  can  seldom  be  induced  to  expend  money 
for  that  purpose.  The  more  these  brief  bulletins  are  circulated,  however,  the 
greater  will  be  the  demand  for  the  more  extensive  information  which  is  supplied 
by  the  many  excellent  books  upon  the  various  branches  of  husbandry  which  are 
now  rapidly  issuing  from  the  press.  All  books  of  this  -^lass  arc  issued  by  private 
publishers,  and  must  be  purchased. 

II.   A  FEW  BOOKS  OF  INTEREST  TO  FARMERS 

The  following  list  of  books  on  various  branches  of  husbandrj-  and  its 
related  sciences,  will  be  found  convenient.  There  are  great  numbers  of  such 
books,  and  I  have  simply  chosen  from  those  with  which  I  happen  to  be  familiar. 
The  selection,  under  each  head,  will  be  found  to  cover  the  subject  fairly  well 
for  the  general  reader.  Tlic  absence  of  any  good  book  published  in  this  coun- 
try from  the  list,  merely  shows  that  I  am  not  personally  familiar  with  it,  or 


APPENDIX.  567 

that  it  is  too  extensive  or  abstruse  for  popular  reading,  or  too  expensive,  or, 
possibly,  that  it  has  been  published  many  years,  and  may  be  out  of  print,  or 
likely  to  be  soon  superseded.  The  books  named  here  are  standard  works,  easy 
to  read  and  understand. 

All  these  books  can  be  obtained  at  the  prices  named,  either  by  ordering  from 
the  nearest  book  store  or  by  remitting  the  amount  direct  to  the  publisher,  who 
will  send  them  postage  paid. 

I  have  roughly  classified  the  publications  under  some  of  the  headings  of  the 
Books  of  this  volume.  Subjects  run  into  each  other  so  much  that  no  exact 
classification  can  easily  be  made. 

THE  LARGER  ASPECTS   OF  FARM  LIFE. 

This  Book  consists  of  a  brief  exposition  of  accepted  opinion  as  to  the 
social  tendencies  of  our  race.  Literature  upon  this  subject  is  abundant,  if  not 
excessive,  but  I  know  of  no  publication,  other  than  the  brief  statement  of  the 
text,  which  singles  out  the  farmer  and  his  interests  for  special  discussion.  The 
reader,  however,  who  desires  to  look  into  the  subject  more  deeply  may  be  aided 
by  the  following  suggestions: — 

The  doctrine  which  we  call  Evolution  is  a  growth  which  blossomed  and 
fructified  in  the  writings  of  Charles  Darwin,*  whose  patient  investigations, 
extended  over  many  years,  supplied  the  first  data  which  were  generally  accepted 
as  an  adequate  physical  basis  of  the  doctrine.  His  conclusions,  advanced 
tentatively,  and  with  a  modesty  unusual  even  in  a  great  scholar,  have  been 
abundantly  justified  by  the  results  of  the  labors  of  two  generations  of  investi- 
gators, but  his  great  book — "The  Origin  of  Species  " — has  never  been  super- 
seded, and  is  not  likely  to  be.  The  student  who  desires  to  acquire  any  adequate 
conception  of  the  doctrine  of  evolution  as  applied  to  the  moral,  social,  and 
spiritual  world,  will  do  best  to  begin  with  the  "  Origin  of  Species."  There 
must  be  some  basis  of  fact  upon  which  to  reason  intelligently.  This  is  best 
supplied  by  a  study  of  the  physical  history  of  the  development  of  the  existing 
forms  of  vegetable  and  animal  life;  and  the  original  study,  when  confirmed, 
as  in  this  case,  by  the  observations  of  all  later  observers,  is  always  the  best.  It 
has  a  certain  life  which  is  necessarily  wanting  in  all  subsequent  discussion. 

"  The  Origin  of  Species  "  may  be  obtained  in  the  United  States  in  editions 
as  stated  below. 

The  collection  and  digestion  of  the  facts  which  form  the  physical  basis  of 
evolution  possibly  mark  the  limit  of  the  powers  of  the  human  intellect  in 
that  direction.  The  phenomena  of  social  evolution  are  so  vast  and  varied 
that  it  seems  impossible  to  collect,  classify,  and  comprehend  them  in  any  such 
manner  as  to  make  of  them  a  sound  basis  of  inductive  reasoning.  Mr.  Herbert 
Spencer  ("  Principles  of  Sociology  ")  has  done,  perhaps,  all  that  can  be  done  in 
this  direction,  but  it  does  not  satisfy  the  mind  as  do  the  physical  facts  collected 
by  Darwin  and  his  successors.     To  me,  and  probably  to  most  men,  the  doctrine 


*>rr.  Darwin  was  by  no  means  the  first  to  iidvocato   the   doctrine  of  evolution  of 
species. 


568  APPENDIX. 

of  social  evolution  is  not  an  induction  from  observed  facts,  but  is,  rather, 
inferred,  deductively,  from  the  general  course  of  history,  and  from  the  con- 
viction that  one  plan  runs  through  all  the  operations  of  the  universe. 

And  yet  there  is  no  doctrine  more  firmly  implanted  in  human  conviction 
than  that  which  teaches  that  all  human  progress  is  the  result  of  irresistible 
natural  forces,  operating  by  immutable  natural  laws,  to  produce  inevitable 
results.  While  perhaps  incapable  of  demonstration  in  any  scientific  sense, 
this  seems  to  accord  with  all  human  experience.  The  doctrine  has  passed  into 
the  current  thought  of  the  people. 

There  is  great  danger  in  that  doctrine.  However  true  it  may  be,  it  is  still 
dangerous.  It  tends  to  fatalism,  and  to  the  belief  that  man  is  controlled  by 
liis  environment  and  is  irresponsible.  The  social  force  is  the  result  of  the 
social  wilL  The  social  will  is  the  aggregate  of  the  individual  wills.  The 
individual'will  is  what  the  individual  makes  it.  Each  individual  is  therefore 
responsible  for  a  fixable  quantity  of  the  social  will  and  social  force,  and  to  the 
extent  that  his  will  is  good  or  evil  he  changes  the  course  of  human  progress. 
If  he  is  a  mighty  man  his  influence  is  mighty.  Caesar,  Napoleon,  Wilberforce, 
Lincoln,  Moody  were  tremendous  influences  of  social  force.  If  the  man  is 
trifling  his  influence  is  trifling.  But  whether  weak  or  mighty  the  responsibility 
of  the  man  is  the  same.  Man  is  influenced  by  his  environment,  but  not  con- 
trolled by  it.  And  he  largely  creates  his  environment.  It  is  unhealthy  for 
men  to  come  to  think  otherwise  than  this,  and  I  am  unwilling  to  advise  general 
readers  to  study  social  evolution  without  warning  them  against  inferences 
not  justified  by  facts,  and  which  educated  evolutionists  do  not  make. 

As  I  write  this  upon  a  railroad  train  I  overhear  two  brutes,  sitting  in  front 
of  me,  talking  disgustingly.  They  are  in  human  form,  well  dressed,  with 
delicate  hands,  evidently  with  money  to  spend.  Hardly  a  word  that  they  say 
could  be  printed.  When  they  turn  their  faces  to  me  I  see  that  they  are 
degenerates.  I  recognize  that  the  extinction  to  which  they  are  hastening  is 
desirable  for  mankind,  and  merciful  to  themselves.  They  are  corrupting  each 
other  as  they  talk,  and  doubtless  corrupt  many  whom  they  meet.  Their  own 
bad  wills  have  made  them  what  they  are,  and  they  change  the  aggregate  of 
existing  social  force  in  ways  for  which  they  are  responsible.  Evolution  does 
not  teach  fatalism. 

If  the  general  reader  who  has  become  familiar  with  Darwin's  groat  work 
will  then  obtain  a  copy  of  Dr.  Jordan's  "Foot-notes  on  Evolution,'"  he  will 
be  as  well  equipped  as  is  necessary  for  appreciating  current  forms  of  reasoning 
upon  social  topics.  If  he  wishes  to  go  further,  and  is  prepared  to  do  some 
rather  hard  thinking,  he  can  perhaps  do  no  better  than  to  get  two  books  which 
have  had  a  wide  circulation  in  America,  namely,  "  Kidd's  Social  Evolution," 
with  which  he  may  or  may  not  fully  agree,  and  "Drummond's  Ascent  of 
Man."  Those  who  have  well  read  all  the  foregoing  books,  will  find  them- 
selves thereby  introduced  into  a  great  sea  of  literature  upon  social  topics,  over 
which  they  need  no  further  guidance  from  me. 

The  titles,  publishers,  and  prices  of  these  books  are  as  follows: — 
Thk  Origin  of  Species.— By  Charies  Darwin.     D.  Appleton  &  Co.,  New 
York.     Price,  $2.00. 


APPENDIX.  569 

The  same,  a  cheaper  edition,  published  by  A.  L.  Burt  &  Co.,  97  Eeade 
Street,  New  York.     Price,  75  cents. 

Foot-notes  on  Evolution. — By  David  Starr  Jordan,  president  of  Leland 
Stanford  Jr.  University.     D.  Appleton  &  Co.,  New  Yorl<.     Price,  $1.75. 

Social  Evolution. — By  Benjamin  Kidd.  The  Macmillan  Company, 
New  Yorl<.     Price,  $1.50.     Paper  cover,  25  cents. 

The  Ascent  of  Man. — By  Henry  Drummond.  James  Pott  &  Co.,  119 
West  Twenty-third  Street,  New  York.     Price,  $1.00. 

THE  FARMERS'  EDUCATION. 

A  careful  reading  of  the  books  named  in  the  following  list  will  go  far  to 
make  one  an  educated  farmer.  It  is  a  good  selection  of  late  books  on  many 
farm  topics.  Upon  some  practical  subjects  I  know  of  no  books  which  I  am 
willing  to  recommend. 

Nature  Study. 

Lessons  with  Plants. — By  Prof.  L.  H.  Bailey.  The  Macmillan  Com- 
pany, New  York.     Price,  $1.10  (postage  in  addition). 

The  Great  World's  Farm. — By  Selina  Gage.  The  Macmillan  Com- 
pany, New  York.     Price,  $1.50. 

Theory  and  Practice  of  Husbandry. 
the  i^ukal  science  series. 

All  the  books  of  this  series  are  published  by  Macmillan  &  Co.,  New  York, 
under  the  editorial  supervision  of  L.  H.  Bailey,  Professor  of  Horticulture  in 
Cornell  University,  Each  book  is  written  by  a  specialist  in  the  subject  treated. 
New  volumes  are  constantly  added  to  the  series,  and  readers  will  be  entirely 
safe  in  ordering  them  as  they  appear.  The  numbers  issued  or  announced  at 
the  time  this  book  is  published  are  as  follows  : — 

The  Soil.— By  Prof.  F.  H.  King.     Price,  75  cents. 

The  Fertility  of  the  Land. — By  Prof.  I.  P.  Roberts.     Price,  $1.25. 

The  Principles  of  Agriculture. — By  Prof.  L.  H.  Bailey  and  others. 
Price,  $1.25. 

Fertilizers. — By  Prof.  E.  B.  Voorhees.     Price,  $1.00. 

Principles  of  Fruit-qrowino. — By  Prof.  L.  H.   Bailey.     Price,  $1.25. 

The  Spraying  of  Plants. — By  Prof.  E.  G.  Lodeman.     Price,  $1.00. 

The  HoRTicuLTirRALiSTs'  Rule  Book. — By  Prof.  L.  H.  Bailey.  Price, 
75  cents. 

The  Evolution  of  Our  Native  Fruits. — By  Prof.  L.  H.  Bailey. 
Price,  $2.00. 

The  Pruning  Book.— By  Prof.  L.  H.  Bailey.     Price,  $1.50. 

The  Forcing  Book.— By  Prof.  L.  H.  Bailey.     Price,  $1.00. 

Garden  Making. — By  Prof.  L.  H.  Bailey  and  others.     Price,  $1.00. 

Bush  Fruits.— By  Prof.  F.  W.  Card.     Price,  $1.50. 

The  Nursery  Book.— By  Prof.  L.  H.  Bailey.     Price,  $1.00. 

The  Survival  of  the  Unlike  (Philosophy  of  Plant  Development). — By 
Prof.  L.  H.  Bailey.     Price,  $2.00. 


570  APPENDIX. 

Plant  Breeding.— By  Prof.  L.  H.  Bailey.     Price,  $1.00. 
Milk  and  Its  Products.— By  Prof.  H.  H.  Wing.     Price  $1.00. 
Principles  of  the  Breeding  q*-  Animals.— By  Prof.  W.  H.  Brewer.* 
The  Physiology  of  Plants.  — By  Prof.  J.  C.  Aerthen.* 
There  are  announced  for  this  series  the  following,  all  by  specialists  in  their 
subjects : — 

Plant  Pathology. 

Seeds  and  Seed  Growing. 

Leguminous  Plants  and  Nitrogen  Gathering. 

Irrigation  and  Drainage. 

KuRAL  Wealth  and  Welfare. 

Farm  Poultry. 

The  Kural  Science  Series,  so  far  as  issued,  is  the  most  valuable  collection  oi 
books  on  rural  topics  in  the  English  language.  There  is  no  reason  to  doubt 
that  the  volumes  to  follow  will  be  of  equally  high  character. 

Other  Books  on  Farm  Topics. 

How  Crops  Feed.— By  Prof.  S.  W.  Johnson.  Orange  Judd  Co.,  New 
York,  1890.     Price,  $2.00. 

How  Crops  Grow.— By  Prof.  S.  W.  Johnson.  Orange  Judd  Co.,  New 
York,  1868.     Price,  $2.00. 

These  two  books  by  Professor  Johnson,  of  Yale  University,  are  standard 
books  on  their  subjects,  but,  like  nearly  all  books  of  their  class,  published  more 
than  ten  years  since,  devote  more  space  to  pure  science  than  is  now  thought 
desirable. 

Agriculture  in  Some  of  Its  Relations  with  Chemistry.— By  Prof. 
F.  H.  Storer.  Charles  Scribner's  Sons,  New  York.  In  two  volumes.  Price, 
$5.00.  This,  like  the  two  volumes  immediately  preceding,  is  a  standard  work, 
requiring  careful  thought.  There  are  many  excellent  books  of  the  same  class, 
l)Ut  upon  the  whole  it  seems  to  me  that  the  more  modern  books  of  general 
agriculture  are  likely  to  be  more  helpful  to  the  modern  farmer.  They  usually 
go  right  to  the  pith  of  farm  practice,  introducing  only  so  much  of  science  as 
is  necessary  to  illustrate  the  subject  in  hand. 

Horticulture. 

California  Vegetables.— By  Prof.  E.  J.  Wickson.  Pacific  Rural  Press, 
San  Francisco,  1897.     Price,  $2.00. 

California  Fruits.— By  Prof.  E.  J.  Wickson.  Pacific  Rural  Press, 
San  Francisco,  revised  edition,  1899.     Price, 

These  are  the  standard  books  for  Pacific  Coast  practice,  which,  in  many 
respects,  differs  from  eastern  practice.  A  new  edition  of  California  Fruits  is  in 
preparation,  to  be  issued  during  the  season  of  1899. 

The  Raisin  Industry.— By  Gustave  Eiscn.  H.  S.  Crocker  &  Co.,  San 
Francisco,  1890.     Price,  $2.00. 


^  Not  yet  publishe.l.    May,  189!). 


APPENDIX.  571 

Grape  Cultttre  and  Wine  Making. — By  Prof.  Geo.  Husman.  Payot, 
Upham  &  Co.,  San  Francisco,  1887.     Price,  $2.00. 

(This  should  be  supplemented  by  later  publications  of  the  University  of  Cal- 
ifornia, on  varieties  and  resistant  vines.) 

The  Ameri(;an  Fruits.— By  John  J.  Thomas.  Wm.  Wood  &  Co.,  New 
York,  Kevised  1897.     Price,  $2.50. 

The  Nut  Culturist. — By  Andrew  S.  Fuller.      Orange  Judd   Co.,  New 

York,  189G.     Price  |1.00. 

Dairying. 

The  Dairyman's  Manual. — By  Henry  Stewart.  Orange  Judd  Co.,  New 
York,  1888.     Price,  $2.00. 

American  Dairying. — By  H.  B.  Gurler.  The  J.  H.  Sander's  Publishing 
Co.,  Chicago,  1894.     Price,  |1.00. 

Testing  Milk  and  Its  Products. — By  Prof.  E.  H.  Farrington  and  Prof. 
F.  W.  Woll.     Price,  $1.00. 

A  B  C  IN  Cheese-making. — By  J.  H.  Monrad,  Orange  Judd  Co.,  New 
York,  1894.     Price,  50  cents. 

Outlines  of  Dairy'  Bacteriology'. — By  Prof.  H.  L.  Russell.  Orange 
Judd  Co.,  New  York,  1898.     Price,  $1.00. 

Livestock. 

Feeds  and  Feeding.  By  Prof.  W.  A.  Henr^^  Published  by  the  author, 
Madison,  Wis.     Price,  $2.00. 

Stock  Breeding. — By  Prof.  Manley  Miles.  D.  Appleton  &  Co.,  New 
York,  1883.     Price,  $1.50. 

The  Domestic  Sheep. — By  Henry  Stewart.  American  Sheep  Breeder, 
Chicago,  1898.     Price,  $1.00. 

American  Horses  and  Horse  Breeding. — By  John  Dimon.  Orange 
Judd  Co.,  New  York,  1895.     Price,  $3.50. 

American  Cattle.  By  Lewis  F.  Allen.  Orange  .Tudd  Co.,  New  York. 
Price,  $2.50. 

Swine  Hushandry. — By  F.  D.  Coburn.  Orange  Judd  Co.,  New  York, 
Price,  $1.75. 

Poultry. 

The  American  Standard  of  Perfection  in  Poultry. — Price,  $1.00. 
(This  book  is  published  and  revised  from  time  to  time,  by  the  American 
Poultry  Association.  It  describes  the  "  points  "  of  all  recognized  breeds.  It 
may  be  obtained  from  the  Orange  Judd  Co.,  New  York.) 

Bees  and  Bee-keeping. 

A  Practical   Treatise   on   the    Hive    and    Honey    Bee. — By  L.  L. 

Langstroth,  1859,  revised.    Price,  $1.00.    May  be  obtained  of  Orange  Judd  Co., 

New  York. 

The  a  B  C  of  Bee  Cui/i'uke. — By  A.  L.  Root.     Orange  Judd  Co.,  New 

York,  1895.     Price,  $1.25. 

Miscellaneous. 

Irrigation  Farming. — By  Lute  Wilcox.  Orange  Judd  Co.,  New  York, 
1895.     Price,  $2.00. 


572  APPENDIX. 

The  American  Sugar  Industry. — By  Herbert  Myrick,  and  Prof.  "W.  C. 
Stubbs.     Orange  Judd  Co.,  New  York,  1898.     Price,  50  cents.     (Sugar  beets.) 

The  Tobacco  Leaf. — By  J.  B.  Killegrew  and  Herbert  Myrick.  Orange 
Judd  Co.,  New  York,  1897.     Price,  |2.00 

Economic  Entomology. — By  John  B.  Smith.  J.  B.  Lippincott  Company, 
Philadelphia,  1896.     Price,  $2.50. 

Plant  Life  on  the  Farm. — By  Maxwell  T.  Masters.  Orange  Judd  Co., 
1885.     Price,  $1.00. 

Drainage  for  Profit  and  Drainage  for  Health. — By  Geo.  E.  Waring, 
Jr.     Orange  Judd  Co.,  New  York,     Price,  $1.50. 

Government  Forestry  Abroad. — By  Gustave  Pinchot.  The  Macmillan 
Co.,  New  York.     Paper,  75  cents,  with  postage  added. 

Practicability  of  the  American  Forest  Administration. — By  B.  E. 
Fernow.  The  Macmillan  Co.,  New  York.  Paper.  Price,  75  cents,  plus  10 
cents  for  postage. 

Forest  Planting. — By  H.  Nicholas  Jarchow.  Orange  Judd  Co.,  New 
York,  1897.     Price,  $1.50. 

In  addition  to  the  foregoing  and  many  more  books  of  a  general  nature, 
there  are  excellent  special  publications  giving  the  experience  of  practical  men 
in  the  production  of  all  crops  and  the  conduct  of  all  farm  operations.  Their 
names  can  be  learned  from  the  publishers'  catalogues  and  the  advertising 
columns  of  the  agricultural  press. 

The  Orange  Judd  Co.,  New  York,  publishes  more  strictly  agricultural  books 
than  any  other  American  house,  and,  in  addition,  it  includes  in  its  catalogue 
the  more  important  publications  of  other  publishers.  The  Macmillan  Com- 
pany perhaps  comes  next.  The  catalogues  of  these  two  houses  will  almost 
certainly  indicate  to  any  farmer  just  how  to  get  any  special  information  which 
he  needs.  The  wonderful  intellectual  awakening  of  the  farmers  which  is  now 
going  on  is  stimulating  the  preparation  of  books  on  rural  topics,  and  within  a 
short  time  it  is  probable  that  the  lists  of  most  publishers  will  contain  many 
books  of  importance  on  rural  topics. 

Upon  the  topics  treated  in  Book  Fourth  I  know  of  little  literature  of  a 
popular  nature.  The  best  means  of  information  in  regard  to  banking  and 
railroads  are  official  reports,  state  and  national,  and  articles  in  such  periodicals 
as  the  Forum  North  American  Review^  Popular  Science  Monthly,  American 
Journal  of  Economics,  and  similar  periodicals  more  or  less  familiar  to  all. 
Perhaps  the  best  sources  of  information  on  these  and  kindred  topics,  including 
ti nance  in  all  its  aspects,  and  civic  and  social  movements,  are  the  publications 
wliich  are  appearing  every  year,  of  the  American  Economic  Association, 
Columbia  University  (both  these  obtainable  from  the  Macmillan  Co.),  the 
University  of  Pennsylvania  (Philadelphia),  and  the  Johns  Hopkins  University 
(Baltimore).  All  these  can  be  found  in  any  large  library,  or  catalogues  con- 
taining titles  and  authors  can  be  obtained  at  the  addresses  given.  These  papei-s 
are  all  monographs  by  some  of  the  ablest  men  of  America,  and  are  written  from 
all  sides  of  most  important  questions.  They  are  somewhat  expensive  but  a  good 
popular  demand  would  soon  result  in  reduced  prices.  Conant's  History  of 
MoDKKN  Banks  of  Issuf,  is  interesting  to  the  general  reader.  Pul)lislied  b3' 
G.  P.  Putnam's  Sons,  New  York,  1896,     Price,  $3.00. 


APPENDIX.  573 

COOPERATION. 

The  literature  of  cooperation  is  abundant,  but  I  have  found  few  books 
published  in  America  which  deal  specially  with  the  details  of  cooperation 
among  farmers.  There  are  books  published  in  Great  Britain  treating  of  pro- 
ductive cooperation  in  farming,  which  has  been  found  successful  there  when 
the  produce  was  assured  of  a  preferential  home  market.  This  occurs  only  when 
the  land  is  owned  by  a  "cooperative  store"  which  retails  tlie  produce.  For 
the  most  part  the  authors,  of  books  upon  mercantile  cooperation  have  in  mind 
a  saving  by  buying  cheaply,  while  the  object  of  farmers'  marketing  associations 
is  to  gain  by  obtaining  high  prices.  Both  seek  to  eliminate  unnecessary 
middlemen,  and  to  themselves,  so  far  as  possible,  do  the  work  of  those  which 
are  necessary.  The  cooperation  of  labor  does  not  usually  consist  in  forming 
societies  to  sell  the  labor,  but  for  regulating  its  price,  and  preventing  those  not 
members  of  the  societies  from  getting  work.  These  are  called  trade  unions, 
and  the  literature  concerning  them  is  voluminous.  ^The  books  on  cooperation 
are  sometimes  written  by  enthusiasts  who  have  not  had  practical  experience 
with  its  difficulties.  The  English  Cooperative  Wholesale  Society  issues  a  great 
number  of  valuable  tracts,  apparently  mailed  free  to  any  applicant.  Address 
the  Central  Cooperative  Board,  City  Buildings,  Corporation  Street,  Manchester, 
England.  The  Cooperative  Nevjs  is  a  weekly  paper,  the  official  organ  of  English 
cooperative  societies.  Address,  Cooperative  News,  Long  Millgate,  Manchester, 
England.  It  is  published  at  one  penny  a  week.  Something  is  doubtless  ivdded 
for  foreign  postage.  The  same  society  publishes  the  Reports  of  the  annual 
meetings  of  the  British  Cooperative  Congress,  which  are  wonderful  documents. 
I  do  not  know  the  price. 

The  following  books  on  some  of  the  forms  of  cooperation  have  been 
selected  from  a  large  number  of  titles,  and  together  will  give  a  very  fair  idea 
of  what  different  people  understand  by  cooperation  and  the  progress  which  it 
is  making  in  this  and  other  countries. 

A  Treatise  on  Cooperative  Savings  and  Loan  Banks. — By  Soy  incur 
Dexter.     D.  Appleton  &  Co.,  New  York,  1894.     Price,  $1.25. 

How  TO  Cooperate. — By  Herbert  Myrick.  Orange  Judd  Co.,  New  York. 
Cloth,  $1.00;  paper,  25  cents. 

Labor  Copartnership. — By  Henry  D.  Lloyd,  Harper  &  Brothers,  New 
York,  1898.     Price,  $1.75. 

Profit  Sharing  between  Employer  and  Employee. — By  N.  P.  Gil- 
more.     Houghton,  Mifflin  &  Co.,  Boston,  1889.     Price,  $1.75. 

History  of  Cooperation  in  America.— By  Prof.  E.  W.  Bemis,  Prof. 
Amos  G.  "Warner,  Dr.  Albert  Shaw,  Mr.  Charles  H.  Shinn,  and  Mr.  David 
R.  Randall.  Johns  Hopkins  University  Press,  Baltimore,  1888.  Price,  $3.50. 
(This  book  gives  an  excellent  summary  of  cooperative  work  in  America  up 
to  the  date  of  its  publication,  hut  it  has,  I  believe,  no  mention  of  any  coopera- 
tive marketing  society.) 

People's  Banks. — By  Henry  W.  Wolf.  Longmans,  Green  &  Co.,  London, 
1893.  (This  is  an  English  book,  and  I  am  not  able  to  give  the  price.  It  is  a 
book  of  only  261  pages,  and  will  not  be  found  expensive.     It  may  be  ordered 


574  APPENDIX. 

of  any  bookseller  or  of  Charles  Scribner's  Sons,  New  York,  who  are  large 
importers  of  English  books.  It  describes  cooperative  banking  as  it  exists  in 
various  countries  of  Europe.) 

The  Tariff  Question. 

It  is  a  little  curious,  but  it  seems  to  be  the  fact  that  there  is  no  strictly 
modern,  non-political,  Americafi  book,  of  moderate  price,  by  an  able  man, which 
takes  the  side  of  "  Protection  "  in  the  tariff  controversy.  As  stated  elsewhere, 
the  non-political  writers  all  seem  to  be  free  traders.  A  few  such  books  which 
have  been  written  seem  mostly  out  of  print.  The  best  I  can  find  is  the  follow- 
ing, written  by  an  Englishman: — 

Sophisms  of  Free  Trade. — By  Sir  John  Bernard  Byles.  Henry  Carey 
Baird  &  Co.,  Philadelphia,  1884.     Price,  $1.25. 

A  good  book  on  the  free  trade  side  is — 

Protection,  or  Free  Trade. — By  Henry  George.  Doubleday  &  McClure 
Co.,  New  York.     Price,  $1.00;  in  paper,  25  cents. 

The  Single  Tax. 

The  leading  book  favoring  the  single  tax  is,  of  course — 

Progress  and  Poverty. — By  Henry  George.  Doubleday  &  McClure 
Co.,  New  York.     Price,  $1.00;  paper,  25  cents. 

Another  good  book  on  the  same  side  is — 

Natural  Taxation.— By  Thomas  G.  Shearman.  Doubleday  &  McClure 
Co.,  New  York.     Price,  $1.00;  paper,  25  cents. 

On  the  opposite  side  there  is  a  great  dearth  of  good  books,  although  in  this 
case  the  great  majority  of  the  social  and  financial  lights  oppose  the  single  tax. 
Their  utterances,  however,  must  be  mostly  looked  for  in  the  periodical  litera- 
ture of  a  few  years  back,  which  is  hardly  accessible,  except  in  public  libraries. 
"Property  and  Progress,"  by  H.  W.  Mallock,  is  a  reply  to  Mr.  George,  and 
may  be  found  in  many  libraries,  but  now  seems  to  be  out  of  print.  Perhaps  the 
best  "  reply  "  in  book  form  is  that  of  the  Duke  of  Argyle,  which  first  appeared 
in  the  nineteenth  century  for  April,  1884,  and  is  republished  in  this  country, 
by  Mr.  George's  publishers,  with  Mr.  George's  rejoinder.  The  title  of  this 
book  is — 

The  Land  Question. — Doubleday  &  McClure  Co.,  New  York.  Price, 
$1.00;  paper,  25  cents. 

Excellent  books  to  read  on  the  general  subject  of  taxatit)n  are: — 

Essays  in  Taxation.— By  Prof.  E.  K.  A.  Scligman,  The  Macmillan  Co., 
New  York.     Price,  $3.00. 

Also  a  smaller  work — 

Equitable  Taxation. — By  Walter  E.  Weyl  and  others.  T.  Y.  Crowell 
&  Co.,  New  York,  1892.     Price,  75  cents. 

Currency. 

The  best  book  for  popular  reading,  on  the  gold  side  of  the  money  question, 
is  Some  Facts  about  Money.  By.  Prof.  J.  Laurence  Laughlin.  The  pub- 
lishers of  this  book,  however,  are  not  now  in  business,  and  I  can  not  find  that 
the  book  is  in  print.     The  following,  however,  will  be  found  satisfactory  : — 


API'KNDIX.  575 

The  Case  agaikst  Bimetalism.— By  Robert  Giff(!ii.  The  Macmillan 
Co.,  New  York,  1892.     Price,  |2.00. 

A  good  book  for  those  who  wish  to  see  an  impartial  discussion  of  the 
subject   is — 

International  Himetalism. — By  Prof.  Francis  A.  Walker.  Henry  Holt 
&  Co.,  New  York,  1896.     Price,  $1.25. 

Those  who  wish  to  see  the  silver  side  presented  by  a  strunu;  man  who  will 
not  stoop  to  misrepresentation  should  read — 

An  Honest  Dollar. — By  President  E.  Benjamin  Andrews.  The  Mac- 
millan Co.,  New  York.     Paper,  75  cents,  plus  10  per  cent  for  postage. 

It  is  claimed  by  some  that,  conceding  the  appreciation  of  gold,  it  is  more 
than  offset  by  the  depreciation  of  interest.  Those  who  would  like  to  look  into 
this  are  referred  to — 

Appreciation  and  Interest. — By  Prof.  Irving  Fisher.  The  Macmillan 
Co.,  New  York.     Price,  75  cents,  plus  10  per  cent  for  postage. 

Trusts. 

A  good  book  about  "  Trusts  "  is — 

Trusts  or  Industrial  Combinations  in  the  United  States. — By  Ernst 
Von  Halle.     The  Macmillan  Co.,  New  York,  1895.     Price,  $1.25. 

The  Referendum. 

The  Swiss  Confederation. — By  Sir  Francis  Ottiwell  Adams.  The  Mac- 
millan Co.,  New  York,  1894.     Price,  $2.50. 

The  Referendum  in  America. — By  E.  P.  Uberholtzer.  The  University 
of  Pennsylvania,  Philadelphia,  1893.     Price,  $1.50. 

Socialism. 

Out  of  a  great  mass  of  literature  it  seems  to  me  that  the  following  is  as  good 
a  selection  as  can  be  made  for  the  general  reader: — 

The  Cooperative  Commonwealth. — By  Laurence  Gronlund.  Lee  & 
Shepherd,  Boston.     Price,  $1.00.     (Socialistic.) 

The  Quintessence  of  Socialism. — By.  Dr.  A.  SchafHo.  Charles  Scrib- 
ner's  Sons,  New  York.     Price,  $1.00.    .(Socialistic.) 

Socialism.— By  Prof.  Richard  T.  Ely.  T.  Y.  Crowell  &  Co.,  New  York, 
1894.     Price,  $1.50,     (Impartial.) 

The  Tyranny  of  Socialism. — By  Yves  (iuyot.  Charles  Scribncr's  Sons, 
New  York,  1894.     Price,  $1.00.     (Anti-socialistic.) 

Anarchism.  By  E.  V.  Zenker.  G.  P.  Putnam's  Sons,  1897.  Price, 
$1.50.  (Anti-anarchistic,  and  showing  the  opposition  of  Anarchism  to 
Socialism.) 

The  "labor  question"  will  be  found  t[uitc  sufficiently  covered  in  the 
foregoing  works  on  Socialism. 

The  foregoing  list  has  been  prepared  for  the  benefit  of  those  who  wish  lo 
inform  themselves  upon  the  topics  considered,  but  do  not  have  access  to  large 
libraries,  or  any  convenient  means  of  finding  out  what  books  to  buy.  It  is 
hoped  that  it  will  be  found  helpful. 


Appendix  E, 


I.       SOME      STATISTICS      RELATING     TO     BANKS,     FROM      THE 

REPORT    OF    THE    COMPTROLLR    OF    THE 

CURRENCY    FOR    1897. 


/.     NATIONAL   BANKS 

Number  of  national  banks  organized  since  1863 5,095 

Number   voluntarily  ceasing   business   since  beginning  of  tlie 

system 1,125 

Became  insolvent 353 

Total  passed  out  of  the  system 1,478 

Number  in  operation  October  31,  1897 3,617 

Capital  stock  paid  up $637,615,445 

Surplus  and  undivided  profits 334,752,000 

Total  capital $972,367,445 

Decrease  in  No.  banks  since  1892 192 

Decrease  in  capital $35,533,620 

No.  shareholders,  July,  1897 281,225 

No.  shareholdei's  holding  $1,000  or  less 169,948 

No.  holding  $1,000  to  $5,000 79,756 

No.  holding  $5,000  to  $30,000 29,541 

No.  holding  over  $30,000    .    .    .    .  • 1,980 

Average  holding,  per  stockholder $2,250 

No.  women  shareholders 101,914 

Value  of  shares  held  by  women $141,854,200 

National  bank-notes  extant  November,  1897 230,131,005 

"        January,  1888 362,651,169 

"              "       May,   1891 170,419,376 

Profit  on  national  bank  circulation,  based  on  deposit  of  United  States  four-per- 
cent bonds,  as  compiled  by  the  government  actuary: — 

October,  1894 ()24  per  cent 

1895 702     "     " 

1896 1.030     "     " 

1897 '.^16     "     " 

The  above  is  based  up'>n  the  estimate  of  six  per  cent  interest  received  by  the 
banks  for  currency  loaned. 

The  account  for  1897  is  made  up  as  follows: — 

(576) 


APPENDIX.  577 

Bonds  deposited $1,000,000 

Currency  received 90,000 

Received  by  bank: — 

Interest  on  $90,000,  six  per  cent $5,400 

Interest  on  bonds,  four  per  cent 4,000 

$9,400 

Reductions:- 

Tax $900  00 

Cost  of  redemption 45  00 

Express  charges 3  00 

Plates 7  50 

Agents'  feee 7  00 

Sinking  fund 418  56 

$1,381  06 

Net  receipts $8,018  94 

Interest  at  six  per  cent  on  market  value  of  bonds  ....        7,702  50 


Profit  by  circulation,  above  what  could  have  been  made  by 

loaning  the  cost  of  the  bonds  at  six  per  cunt $316  44 

Or  .246  per  cent  per  annum. 

(Compare  the  rough  statement  figured  out  in  the  text,  page  144.) 

Deposits  in  national  banks,  October  5,  1897 $1,869,000,000 

It  should  be  evident  that  the  profits  of  nati(;nal  banks  are  mainly  derived 

from  loaning  this  vast  amount  of  money  deposited,  rather  than  from  the  trivial 

pro"fit  on  circulation. 

Net  earnings  of  national  banks  for  a  series  of  twenty-eight  years,  computed  on 
capital  and  surplus;  — 

1870 11.8  percent 


1871 

...  10.4 

1872 10.2 

1873      .  . 

.  .  .  10.7 

1874      .  . 

10  3 

1875       .  .     .9.5 

1876 

....   8.1 

1877 

6  3 

1878 5  3 

1879 

4.8 

3880 

....   6.7 

1881 

....   8.4 

1882      .  . 
1883 

....   9.5 
....   8.6 

1885 

....   6.9 

1886 

....   7.3 

1887 

.  .   .8.5 

1»88   .  .  .  . 

....   8.8 

1889  . 

.  .    8.7 

1890  .  .  . 

8  6 

1891 

....   8.9 

1882  ... 

....   7.8 

1893    .  .  . 

....   7.4 

1894 

....   5.6 

1895   .  .  .  . 

....   5.0 

1896   .... 

....   5.4 

1897 

....   5.4 

From  the  above  it  will  be  noted  that  as  the  country  grows  richer  and  money 
more  abundant,  the  profits  of  banking  decrease.  With  all  the  risk  of  loss,  it 
evidently  pays  best  to  lend  money  to  poor  people.  Note  the  reduction  in  bank- 
ing profits  immediately  following  the  panic  years  of  1873  and  1893.  This  was 
partly  due  to  losses  from  bad  debts  in  those  years,  and  partly  because  people 
were  restricting  their  business  operations,  and  not  borrowing  money. 

It  is  also  important  to  note  the  very  large  number  of  shareholders  in  national 

37 


578  APPENDIX. 

banks,  and  especially  the  number  of  women.  This  shows  that  the  owners  of 
national  banks  are  not  all  rich  men,  but  largely  comparatively  poor  people, 
depending  upon  the  earnings  of  their  money  for  a  livelihood. 

2.     STATE  {COMMERCIAL)  BANKS. 

Number  of  state  banks,  1896-7 3,857 

Total  capital  stock $228,677,088 

Surplus  and  undivided  profits 102,359,024 

Total  capital $331,036,112 

Deposits 723,640,795 

The  comptroller  of  the  currency  is  unable  to  obtain  from  the  state  banks 
and  trust  companies  such  detailed  reports  of  profits  as  the  law  compels  national 
banks  to  furnish,  but  of  five  hundred  fifty-seven  banks  and  one  hundred  sixty- 
seven  trust  companies  reporting,  the  banks  averaged  seven  per  cent  on  their 
capital,  and  the  trust  companies  seven  and  eight-tenths  per  cent.  Had  all 
reported,  the  average  rate  of  dividends  would  doubtless  be  less,  as  it  would 
usually  be  the  least  successful  concerns  that  would  dislike  to  report.  Their 
average  earnings  are  doubtless  about  the  same  as  the  national  banks. 

3.     STATE    LOAN    AND    TRUST    COMPANIES. 

Loan  and  trust  companies  are  usually  banks  receiving  deposits,  but  not 
transacting  the  collection  and  other  minor  functions  of  a  bank,  and  in  most 
cases  confining  their  business  to  large  operations. 

Number  of  loan  and  trust  companies  reporting  to  comptroller 

1896-7 251 

Capital  stock $106,963,253 

Surplus  and  undivided  profits 89,025,207 

Total  capital $195,993,520 

Deposits 566,922,205 

The  ownership  of  the  capital  of  the  state  banks  and  trust  companies  is 
doubtless  distributed  among  small  and  large  stockholders,  like  that  of  the 
national  banks.     There  are  no  general  statistics  upon  this  point. 

The  above  is  not  a  complete  statement  of  the  business  of  the  loan  and  trust 
companies,  as  many,  not  being  so  required,  failed  to  report  to  the  comptroller. 
Keturns  gathered  earlier  in  the  year  by  the  New  York  Financier  and  quoted  by 
the  comptroller,  are  as  follows: — 

Number  of  companies 458 

Capital  stock $141,278,000 

Surplus  and  undivided  profits 97,853,000 

Total  capital $239,131,000 

Deposits 675,100,000 

In  this  case,  also,  complete  returns  of  earnings  were  not  made,  but  the 
dividends  paid  by  the  companies  of  New  York  City  averaged,  for  the  previous 
year,  fifteen  and  one-third  per  cent,  which  shows  the  enormous  profit  attending 


APPENDIX.  579 

the  great  operations  which  these  companies  conduct.  Their  great  profits  come 
largely  from  percentages  on  placing  great  loans  for  corporations  and  govern- 
ments. A  considerable  part  of  these  great  dividends  in  the  year  in  question 
were  doubtless  pi-ofits  upon  the  United  States  three  per  cent  bonds  sold  to  main- 
tain tho  gold  reserve  of  the  United  States  in  the  face  of  a  large  deficit  in  the 
levenue.  When  a  government  gets  into  a  pinch  it  has  to  pay  for  it,  just  as  a 
poor  man  docs. 

4.  PRIVATE    BANKS. 

Of  these  concerns  seven  hund'red  fifty-nine  only  reported  to  the  comptroller, 
which  he  states  to  be  about  twenty  per  cent  of  the  whole  number. 

Number  of  private  banks  reporting 759 

Capital $18,246,007 

Surplus  and  undivided  profits 7,113,121 

Total  capital $25,359,128 

Deposits 50,278,243 

5.  SAVINGS     BANKS. 

Number  of  mutual  savings  banks 666 

(These  have  no  capital  "stock.) 
Number  of  stock   savings   banks 312 

Total  savings   banks 980 

Capital  stock  (stock  banks  only) $  26,199,430 

Surplus  (all   savings    banks) 159,954,756 

Total  capital $186,154,186 

Deposits  subject  to  check $      44,037,529 

Savings  deposits 1,939,376,035 

Total  deposits $1,983,413,564 

Number  of  depositors • 5,201,132 

Average  deposit $372.88 

In  a  savings  bank,  it  is  the  depositors  who  receive  the  profits,  less  the 
expenses  of  the  bank,  and  such  payment  to  the  capital  stock,  if  any,  as  the 
by-laws  of  the  bank  prescribe. 

The  rate  of  interest  earned  for  depositors  in  savings  banks  varied  in  difierent 
groups  of  states,  ranging  from  three  to  five  per  cent. 

The  cost  of  management  of  savings  banks,  was,  in  Maine,  one-fifth  of  one 
per  cent  of  the  deposits ;  and  in  Massachusetts  one-fourth  of  one  per  cent. 
Statistics  are  lacking  as  to  other  states. 

6'.     SUMMARY. 

The  bankii'.ii;  capital  available  for  loaning  consists  of  the  capital  stock, 
surplus  and  undivided  profits,  and  deposits,  less  sums  invested  in  premises  and 
furniture,  and  the  necessary  reserves.  Without  making  these  deductions,  the 
amounts  are  as  follows  : — 


580  APPENDIX. 

National   Banks. 

Capital  and  surplus |    972,367,445 

Deposits.      .    ,  ; 1,869,000,000 

Total  resources $2,841,367,445 

State   Banks: 

Capital  and  surplus |331,036,112 

Deposits 723,640,795 

Total  resources $1,054,676,907 

Loan  and  Trust  Companies. 

Capital  and  surplus ".    .$239,131,000 

Deposits 675,100,000 

Total  resources 1914,231,000 

Pbivate  Banks:* 

Capital  and  surplus |25,359,128 

Deposits 50,278,243 

Total  resources $75,637,471 

Savings  Banks. 

Capital  and  surplus $    186,154,186 

Deposits 1,983,413,564 

Total  resources $2,069,567,750 

Total  capital  for  loaning  (less  reserves  as  above)    .    .    .  $6,955,480,573 
And  this  is  the  money  power. 

II.       THE     RAILROAD      QUESTION. 
1.  DECISIONS   OF   THE   INTERSTATE    COMMERCE   COMMISSION. 

The  proceedings  of  the  Interstate  Commerce  Commission  arc,  in  many- 
respects,  like  those  of  a  court.  Complaints  are  filed,  answers  made,  evidence 
taken  if  necessary,  argument  heaixl,  and  a  decision  rendered.  If,  however,  the 
parties  do  not  comply  with  the  decision,  the  Commission  has  no  power  to 
enforce  them.  For  that  purpose  recourse  must  be  had  to  a  court,  where  the 
entire  question  may  be  tried  over  again,  as  if  it  had  never  been  heard  by  the 
Commission.  Under  our  constitution  there  is  no  way  to  avoid  this,  but  it  is 
possible  to  make  evidence  taken  before  the  Commission  available  before  the 
court,  in  support  of  the  decision  of  the  Commission,  which  the  law  has  made 
prima  facie  evidence  of  what  is  true.  Those  who  have  occasion  to  complain  of 
railroads  are  not  usually  able  to  bear  the  expense  of  litigation,  and  when  they 
have  once  proved  a  thing  some  means  should  be  found  of  making  that  evidence 
available  once  for  all  for  what  it  is  worth.  The  Commission  can  also  be  clothed 
with  greater  power  of  compelling  witnesses  to  testify.  The  tedious  processes  of 
tlic  American  courts  arc  the  strongest  refuge  of  evil-doors.     In  dealing  with 


'About  one-fifth  of  the  i)rivatu  banks  i)uly. 


APPENDIX.  -  581 

the  powerful  corporations  the  people  need  a  strong  tribunal,  not  hound  by 
technicalities,  with  power  to  go  at  once  to  the  pith  of  any  matter  presented,  do 
equity  at  once  and  have  its  decisions  enforced,  until  set  aside  by  due  course  of 
law.  The  Interstate  Commerce  Commission  was  designed  as  such  a  tribunal. 
Its  authority  is  insufficient  for  its  duties.  Tlio  people  can  give  it  the  necessary 
power  if  they  have  a  mind  to.  If  they  will  not  do  this,  it  is  childish  to  com- 
plain of  oppression  in  Interstate  Commerce. 

The  following  decisions  of  the  Commission,  while  not  necessarily  having 
the  force  of  law,  have  been  nearly  always  complied  with.  The  Commission,  up 
to  the  close  of  1898,  had  made  nine  hundred  eighty-five  decisions,  covering 
most  of  the  points  that  are  likely  to  arise  between  the  people  and  the  rail, 
roads  in  Interstate  Commerce.  The  following  selections  from  those  decisions 
will  be  found  of  interest.  The  selection  has  necessarily  been  confined  to 
decisions  establishing  general  principles.  It  will  be  noted  that  in  nearly  all 
cases  the  contest  was  between  localities,  rather  than  between  individuals. 
Doubtless  this  has  been  because  the  discriminations  against  individuals  have 
been  better  concealed.  Discriminations  between  localities  are  obvious,  and  are 
usually  taken  up  by  boards  of  trade  or  other  influential  commercial  bodies. 
The  numbers  prefixed  to  the  decisions  indicate  the  number  of  the  decision  on 
the  docket  of  the  Commission. 

5.  The  Interstate  Commerce  Commission  has  not  been  given  the  authority 
to  authorize  the  grant,  by  railroad  companies,  of  special  privileges  to  individ- 
uals or  corporations,  or  to  sanction  such  as  are  not  in  harmony  with  the  act  to 
regulate  commerce,  or  to  suspend  that  act  for  the  benefit  of  particular 
industries. 

7.  A  petition  was  presented  by  a  manufacturing  corporation,  which  recited 
in  substance  that  railroad  companies  had  been  accustomed  to  permit  it  to  pro- 
cure its  raw  material  at  a  distance,  manufacture  its  goods  therefrom,  and  then 
ship  the  goods  to  a  market  at  the  same  aggregrate  rate  for  transportation  of 
both  raw  material  and  manufactured  goods  as  would  be  charged  had  there  been 
no  stoppage  in  transit  and  no  manufacture;  that  this  privilege  of  manufacturing 
in  transit  was  valuable  to  the  corporation  and  to  the  community  in  which  its 
business  was  located,  and  wronged  no  one  ;  and  petitioner  prayed  that  it  might 
be  sanctioned  by  the  Commission.  But  no  authority  to  that  eflect  having  been 
conferred  upon  the  Commission,  the  petition  was  dismissed. 

12.  It  seems  not  to  be  illegal  for  railroad  companies  connecting  Boston  with 
eastern  points  to  make  the  rates  from  such  points  to  Boston  upon  grain  and 
provisions  for  export  as  low  as  the  rates  to  New  York,  although  the  rates  upon 
like  property  for  local  consumption  are  higher  to  Boston  than  to  New  York, 
the  distance  being  somewhat  greater. 

15.  So  far  as  a  railroad  company,  whose  line  is  entirely  within  one  state, 
issues  through  bills  of  lading  over  its  connecting  lines  to  points  in  other  states, 
and  makes  "through  rales,  it  falls  under  the  provision  of  the  Interstate  Com- 
merce Act. 

19.  That  the  phrase  "  under  substantially  similar  circumstances  and  con- 
ditions "  in  the  fourth  section,  is  used  in  the  same  sense  as  in  the  second  section  ; 
and  under  the  qualified  form  of  the  prohibition  in  the  fourth  section  carriers 
are  required  to  judge  in  the  first  instance  with  regard  to  the  similarity  or  dis- 
similarity of  the  circumstances  and  conditions  that  forbid  or  permit  a  greater 
charge  for  a  shorter  distance. 

20.  That  the  judgment  of  carriers  in  respect  to  the  circumstances  and  con- 
ditions is  not  fintil,  but  is  subject  to  the  autliority  of  the  Commission  and  of  the 
courts,  to  decide  whether  error  has  been  committed,  or  whether  the  statute  has 


582  APPENDIX. 

been  violated.  And  in  case  of  complaint  for  violating  the  fourth  section  of  the 
act  the  burden  of  proof  is  on  the  carrier  to  justify  any  departure  from  the 
general  rule  prescribed  by  the  statute  by  showing  that  the  circumstances  and 
conditions  are  substantially  dissimilar. 

22.  That  the  existence  of  actual  competition,  which  is  of  controlling  force, 
in  respect  to  traffic  important  in  amount,  may  make  out  the  dissimilar  circum- 
stances and  conditions  entitling  the  carrier  to  charge  less  for  the  longer  than 
for  the  shorter  haul  over  the  same  line  in  the  same  direction,  the  shorter  being 
included  in  the  longer  in  the  following  cases : 

I.  When  the  competition  is  with  carriers  by  water,  which  are  not  subject  to 
provisions  of  the  statute. 

II.  When  the  competition  is  with  foreign  or  other  railroads  which  are  not 
subject  to  the  provisions  of  the  statute. 

III.  In  rare  and  peculiar  cases  of  competition  between  railroads  which  are 
subject  to  the  statute,  when  a  strict  application  of  the  general  rule  of  the 
statute  would  be  destructive  of  legitimate  competition. 

23.  The  Commission  further  decides  that  when  a  greater  charge  in  the 
aggregate  is  made  for  the  transportation  of  passengers  or  the  like  kind  of 
property  for  a  shorter  than  for  a  longer  distance  over  the  same  line  in  the 
same  direction,  the  shorter  being  included  in  the  longer  distance,  it  is  not  suffi- 
cient justification,  therefor,  that  the  traffic  which  is  subjected  to  such  greater 
charge  is  way  or  local  traffic,  and  that  which  is  given  the  more  favorable  rates 
is  not. 

24.  Nor  is  it  sufficient  justification  for  such  greater  charge  that  the  short- 
haul  traffic  is  more  expensive  to  the  carrier,  unless  when  the  circumstances  are 
such  as  to  make  it  exceptionally  expensive,  or  the  long-haul  traffic  exception- 
ally inexpensive,  the  difference  being  extraordinary  and  susceptible  of  definite 
proof. 

Nor  that  the  lesser  charge  on  the  longer  haul  has  for  its  motive  the 
encouragement  of  manufactures  or  some  other  branch  of  industry. 

Nor  that  it  is  designed  to  build  up  business  or  trade  centers. 

Nor  that  the  lesser  charge  on  the  longer  haul  is  merely  a  continuation 
of  the  favorable  rates  under  which  trade  centers  or  industrial  establish- 
ments have  been  built  up. 

The  fact  that  long-haul  traffic  will  only  bear  certain  rates  is  no  reason  for 
carrying  it  for  less  than  cost  at  the  expense  of  other  traffic. 

28.  The  practice  of  paying  commissions  to  the  agents  of  other  roads  on 
tickets  sold  over  the  road  of  the  company  paying  the  same,  condemned  as 
demoralizing,  and  as  an  improper  drain  on  corporate  resources. 

32.  Where  complaint  is  made  of  rates  as  excessive,  the  burden  is  upon 
complainant  to  make  proof  of  the  fact  alleged,  and  if  no  proofs  are  put  in  by 
either  party  the  complaint  will  be  dismissed.  This  held  in  a  case  in  which  the 
rates  were  much  higher  than  tliey  had  at  one  time  been  on  the  same  line. 

33.  An  ofier  by  a  railroad  company  to  give  a  discount  to  any  consignee 
who,  within  a  year,  shall  receive  at  any  one  station  a  specified  amount  of 
fi-eight,  which  offer  purports  to  be  made  to  secure  speedy  despatch,  but  it  is  not 
conditioned  on  speedy  despatch  being  made,  is  void,  and  if  a  discount  is  made 
to  one  dealer  in  pursuance  of  it,  all  others  will  be  entitled  to  alike  discount. 

34.  If  the  real  consideration  of  the  offer  were  to  secure  speedy  despatch,  it 
should  have  been  open  to  all  who  could  accept  it,  regardless  of  quantity. 

53,  Mileage  tickets  when  issued  must  be  sold  impartially  to  all  who  apply 
for  them,  and  on  the  same  terms. 

63.  A  common  carrier  of  live  stock  is  subject  to  the  legal  duty  to  provide 
reasonable  and  proper  facilities  for  receiving  and  discharging  from  its  cars  such 
live  stock  as  is  offered  for  transportation,  free  of  all  except  the  customary 
transportation  charges.  It  does  not  fully  discharge  this  duty  by  receiving  on 
and  discharging  from  its  cars  live  stock  at  a  depot,  access  to  which  must  be 
purchased. 

64.  A  railroad  company  as  carrier  of  livestock  had  undertaken  to  give  to  a 


APPENDIX.  583 

stock-yards  company  an  exclusive  right  at  one  of  its  stations,  and  to  require  all 
stock  at  that  station  to  be  received  and  delivered  on  the  platform  of  the  chutes 
of  that  company,  the  company  being  authorized  to  charge  lottage  therefor. 
Complainants  established  by  the  track  of  the  railroad  company  chutes  of  their 
own,  through  which  they  demanded  the  right  of  receiving  and  delivering  the 
stock  of  themselves  and  Uieir  customers.  The  conveniences  furnished  by  them 
being  suitable,  it  was  held  that  their  demand  must  be  complied  with. 

G9.  The  sale  of  "land  explorers'  tickets"  and  "settlers'  tickets"  at  less 
than  the  regular  rates  charged  to  passengers  at  the  usual  ticket  offices,  as 
practiced  by  the  Northern  Pacific  Eailroad  Company,  is  unjust  discrimination. 

71.  The  rule  under  which  passenger  transportation  should  be  conducted 
requires  absolute  equality  of  payment  from  all  persons  enjoying  the  same 
accommodations. 

74.  When  the  same  carrier  operates  parallel  lines,  and  for  any  cause  accepts 
low  rates  on  one  of  them,  it  should  provide  sufficient  corresponding  advantages 
to  the  patrons  of  the  other  line  to  preserve  the  substantial  equality  contem- 
plated by  the  statute. 

75.  Low  charges  upon  one  of  two  routes  operated  by  the  same  carrier 
should  not  be  made  up  by  relatively  high  charges  upon  the  other,  when  the 
result  disastrously  affects  the  business  of  communities  situated  upon  the  latter 
line. 

82.  If  a  railway  company  in  establishing  charges  on  different  divisions  and 
branches  of  its  road  so  adjusts  them  as  to  divert  trade  and  business  to  one 
locality  which  naturally,  under  an  equitable  adjustment  of  charges,  would  go 
to  another,  such  preference  is  not  excused  by  the  fact  that  some  of  such  charges 
are  not  entirely  voluntary,  but  result  from  competition  between  carriers. 

83.  If  determining  what  is  a  just  and  reasonable  rate  for  a  particular 
commodity  (for  example,  wheat)  the  Commission  will  take  into  consideration 
the  earnings  and  expenses  of  operating,  rates  charged  upon  the  same  commodity 
upon  other  roads  as  nearly  similarly  situated  as  may  be,  the  diversities  between 
the  railroad  in  question  and  such  other  roads,  the  relative  amount  of  through 
and  local  business,  the  proportion  borne  by  the  commodity  in  question  to  the 
remainder  of  the  local  traffic,  the  market  value  of  the  commodity  and  its 
gradual  reduction,  the  reduction  made  by  the  carrier  upon  the  articles  which 
are  consumed  and  necessarily  required  by  the  producers  of  the  article  in 
question,  and  all  other  circumstances  affecting  the  traffic  of  itself  and  as  related 
to  other  considerations  entering  into  the  charges  of  the  carrier. 

94.  Colored  people  who  buy  first-class  tickets  must  be  furnished  with 
accommodations  equally  safe  and  comfortable  with  other  first-class  passengers. 
The  Commission  finds  that  the  car  furnished  complainant  was  only  second-class 
in  comforts  for  travel,  and  that  he  was  thereby  subjected  to  undue  prejudice  and 
unreasonable  disadvantage  in  violation  of  the  act  to  regulate  commerce. 

100.  Express  business,  conducted  by  an  independent  organization, 
acquiring  transportation  rights  by  contract,  held  not  to  be  described  in  the  act 
with  sufficient  precision  to  warrant  the  Commission  in  taking  jurisdiction 
thereof. 

105.  By  reason  of  extraordinary  circumstances  a  railroad  company  cannot 
promptly  meet  all  calls  for  cars;  it  should  furnish  them  ratably  and  fairly  to  all 
shippers,  in  proportion  to  the  freights  offered  by  them  respectively,  until  the 
emergency  has  passed,  and  it  is  again  enabled  to  move  promptly  all  the  freights 
tendered. 

108.  Rates  established  by  a  conmion  carrier  in  order  to  keep  upon  its  line 
material  for  which  the  road  has  use,  or  to  keep  the  price  low  for  its  own  advan- 
tage, cannot  be  justified. 

"  109.  Producer  of  railroad  material  is  entitled  to  sell  it  when  hj  wishes,  in 
the  best  available  market.  Common  carriers  are  forbidden  m  attempt  to 
prevent  this  by  applying  disproportionate  or  unreasonable  rate:. 

111.  It  is  not  a  ground  of  complaint  against  a  railrop ..  company  that  it 
equalizes  its  rates  as  between  small  and  large  towns,  e-.   n  though  the  effect 


584  APPENDIX. 

may  be  prejudicial  to  the  large  towns,  which  before  had  been  specially  favored. 

115.  A  carrier  is  not  compellable  by  law  to  give  to  the  merchants  of  a  town 
on  its  line  the  privilege  of  shipping  their  goods  from  the  point  of  purchase  to 
their  own  locality,  and  again  fron^thence  to  the  place  at  which  the  goods  may 
be  sold  by  them,  at  the  s'ame  rate  which  would  have  been  charged  had  there 
been  but  one  shipment  from  the  point  of  purchase  to  the  point  of  ultimate 
delivery. 

116.  The  fact  that  a  refusal  to  give  the  through  rate  as  for  one  shipment 
operates  prejudicially  to  the  town  desiring  the  privilege  and  favorably  to 
another,  does  not  make  the  refusal  operate  as  unjust  discrimination  when  the 
carrier  applies  the  same  rule  to  all  towns  and  accords  the  privilege  to  none. 

129.  As  a  rule,  in  the  transportation  of  freights  by  railroads,  while  the 
aggregate  charge  is  continually  increasing  the  further  the  freight  is  carried,  the 
rate  per  ton  per  mile  is  constantly  growing  less  all  the  time,  making  the  aggre- 
gate charge  less  in  proportion  every  hundred  miles  after  the  first,  arising  out  of 
the  character  and  nature  of  the  service  performed,  and  the  cost  of  the  charges 
of  this  mode  of  transportation  from  and  to  the  most  distant  portions  of  the 
country. 

130.  The  act  to  regulate  commerce,  so  far  from  throwing  hampering  restric- 
tions or  obstacles  in  the  way  of  the  operation  of  this  salutary  rule,  gives  it  all 
the  benefit  and  aid  of  its  sanction  and  safeguards  by  providing  that  the  carrier 
shall  be  entitled  to  receive  a  reasonable  compensation  for  the  service  performed 
upon  open  published  rates,  against  which  no  competitor  can  take  advantage  by 
allowing  shippers  secret  rebates  and  drawbacks  in  order  to  get  the  business. 

137.  A  railroad  company,  chartered  by  the  state  of  Tennessee,  owns  a  short 
road  wholly  in  that  state,  but  has  never  owned  any  rolling  stock  nor  operated 
its  road.  The  road  was  used  and  operated  as  a  means  of  conducting  inter- 
state traffic  in  coal  by  companies  owning  connecting  interstate  roads.  Held, 
that  the  short  road  thus  used  is  one  of  the  facilities  and  instrumentalities  of 
interstate  commerce,  and  the  carriers  using  it  are  subject  to  the  provisions  of 
the  act  to  regulate  commerce. 

143.  "When  two  methods  for  the  transportation  of  an  article  of  merchandise 
are  nominally  ofiered  by  the  carrier,  for  only  one  of  which  it  ofl'ers  rolling 
stock,  and  for  the  other  of  which  the  shipper  must  supply  his  own  rolling 
stock  at  considerable  expense,  it  can  not  be  said  that  the  resort  to  the  latter  by 
the  shipper  is  so  far  a  matter  of  choice  that  he  has  no  concern  with  the  charges 
for  transportation  in  the  other  mode.  The  man  of  small  means  compelled  to 
make  this  choice  by  reason  of  the  carrier's  failure  to  supply  rolling  stock  for 
the  other  mode,  has  a  right  to  insist  that  the  charges  by  transportation  in  the 
two  modes  shall  be  relatively  just  and  equal. 

144.  When  oil  is  transported  in  tanks  permanently  affixed  to  car  bodies, 
the  tank  is  to  be  considered  as  part  of  the  car ;  and  for  oil  transported 
therein  the  charge  for  transportation  should  be  the  same  for  the  hundred  pounds 
that  the  carrier  charges  for  transportation  between  the  same  points  of  barrels 
filled  with  like  oil  and  taken  in  car-load  lots.  The  carrier  is  guilty  of  unjust 
discrimination  if  the  shipper  in  barrels  is  charged  a  higher  rate. 

145.  Neither  the  fact  that  the  shipper  in  "the  one  case  supplies  the  rolling 
stock,  nor  the  alleged  fact,  which  is  not  found  sustained,  that  for  the  tanks 
there  is  a  greater  probability  of  return  loads,  nor  the  further  alleged  fact 
that  with  barrel  shipments  there  are  greater  risks  to  the  carrier's  property  and 
that  which  it  carries,  can  justify  imposing  upon  the  barrel  shipments  the 
greater  burden. 

149.  Regular  patrons  are  not  entitled  to  preference  in  the  use  of  equipment 
of  commoncarriers  ;  the  public  must  be  justly  and  equally  served. 

151.  Selection  of  either  goods  or  customers  is  forbidden  to  common  carriers; 
less  desirable  traffic  which  is  ordinarily  the  subject  of  transportation  and  not 
dangerous  to  handle,  must  be  accepted  upon  reasonable  terms  as  well  as  that 
which  is  more  desirable. 


APPEXDTX.  685 

152.  It  is  not  a  valid  excuse  for  refusal  to  furnish  a  fair  allotment  of  a 
certain  class  of  cars  that  they  can  be  more  profitably  employed,  and  can  supply 
the  wants  of  a  larger  number  of  shippers  upon  another  portion  of  the  line. 

162.  Underbilling,  a  device  by  which  a  shipper  pays  for  the  transportation 
of  a  less  quantity  of  freight  than  is  actually  carried,  and  thereby  obtains  a 
reduced  rate  upon  the  gross  shipment,  is  forbidden  by  the  act  to  regulate 
commerce. 

172.  Classification  of  dried  fruits  and  raisins,  both  California  products,  in 
diiferent  classes,  taking  different  rates  of  freight,  works  an  injustice  to  shippers. 
In  all  matters  of  classification,  clearness  and  simplicity  should  be  aimed  at, 
and  irregularities  and  inconsistencies  should  be  eliminated. 

180.  Trade  centers  of  large  commercial  towns  are  not,  as  a  matter  of  right, 
entitled  to  have  more  favorable  rates  than  the  smaller  towns  for  which  they 
form  distributing  centers ;  and  if  carriers  will  give  to  such  smaller  towns  rates 
as  favorable  as  to  the  larger,  the  Commission  will  not  interfere. 

181.  The  fact  that,  under  rates  which  are  impartially  arranged  as  between 
large  and  small  towns,  one  large  distributing  center  may  have  an  advantage 
over  another  in  competition  for  the  business  of  the  small  towns,  does  not  make 
out  a  case  of  undue  preference  in  favor  of  the  one  distributing  center  as  against 
the  other.  Impartial  rates  are  not  rendered  illegal  by  their  effect  upon  the 
business  of  localities. 

182.  A  distributing  center,  however  great  or  important,  can  not  demand,  as 
a  matter  of  right,  that  the  rates  from  a  common  source  of  supph'  to  more  dis- 
tant and  smaller  towns  shall  be  made  up  of  the  sum  of  the  rate  to  itself  and 
the  rate  thence  to  such  smaller  towns  ;  but  the  carriers  may  make  rates 
from  the  common  source  of  supply  to  the  smaller  towns  directh',  as  single 
rates ;  and  if  the  single  rate  is  less  than  the  sum  of  the  two  which  are  made 
to  and  from  the  distributing  center  it  is  not,  for  that  reason,  necessarily 
objectionable. 

186.  The  method  of  testing  the  freight  rates  of  a  railroad  by  the  rate  per 
ton  per  mile  is  one  by  which  these  rates  may  be  brought  down  to  the  narrowest 
point  of  scrutiny,  and  in  this  sense  is  valuable,  but  it  is  like  looking  at  them 
with  a  microscope,  for  it  ignores  all  other  tests  except  that  which  it  alone 
furnishes,  and  does  not  take  into  consideration  any  of  the  surrounding  circum- 
stances and  conditions  that  enter  into  the  making  of  the  rate,  no  matter  how 
compulsory  or  imperious  these  may  be,  and  for  this  reason  it  can  not  be 
considered  a  controlling  rule  in  determining  the  reasonableness  of  rates. 

187.  To  determine  the  reasonableness  and  justness  of  any  freight  rate  made 
by  a  railroad  company,  all  the  surrounding  circumstances  and  conditions  must 
be  considered,  as  well  as  the  rights  of  the  shipper,  and  if  these  circumstances 
and  conditions  are  so  compulsory  or  imperious  that  they  fairly  and  justly 
exercise  any  controlling  influence  in  the  making  of  a  rate,  they  can  not  be 
disregarded  in  a  proceeding  in  which  the  reasonableness  and  justness  of  the 
rate  is  presented  for  determination. 

188.  The  words  "substantially  similar  circumstances  and  conditions,"  as 
found  in  the  second  and  fourth  sections  of  the  act  to  regulate  commerce,  in 
certain  important  particulars  define  the  rights  and  duties  of  carriers  and  the 
rights  of  shippers  as  well.  For  example:  If  the  carrier  claims  to  act  under  the 
compulsion  of  circumstances  and  conditions  of  his  own  creation  or  convenience 
in  the  making  of  an  exceptional  rate,  then  these  will  not  avail  him.  Or  if  the 
carrier  claims  to  act  under  a  compulsion  of  circumstances  and  conditions  in  the 
making  of  an  exceptional  rate  which  he  could  obviate  by  reasonably  fair  and 
just  exertion  on  his  part,  then  they  will  not  avail  him.  But  if  the  carrier  is  in 
good  faith  acting  under  a  compulsion  of  circumstances  and  conditions  beyond 
his  control,  not  of  his  own  connivance,  and  which  he  could  not  obviate  by  any 
reasonably  fair  and  just  effort  on  his  part,  and  to  avoid  large  loss  adopts 
exceptional  rates  on  a  portion  of  his  line,  not  unreasonable  in  themselves,  and 
forced  upon  him  by  the  action  of  an  independent  state  railroad,  which  is  not 
subject  to  the  act  to  regulate  commerce,  and  which   is   operating   a   slightly 


586  APPENDIX. 

shorter  and  competing  line  with  his  own,  these  are  circumstances  and  con- 
ditions under  the  operation  of  the  statute  which  justify  him  in  adopting  such 
exceptional  rates  thus  forced  upon  him  on  this  portion  of  his  line. 

196.  The  difference  between  the  cost  of  service  by  which  the  local  business 
of  this  railroad  and  its  through  business  is  done  relatively,  examined  and  con- 
sidered by  the  commissioner  so  far  as  they  are  involved  in  this  proceeding. 

197.  Comparison  of  rates  charged  by  railroad  companies  under  circum- 
stances and  conditions  substantially  dissimilar,  really  prove  nothing,  and  can 
not  be  adopted  as  standards  in  arriving  at  the  reasonableness  and  justness 
of  rate. 

198.  Exceptional  cases  of  rates  made  lower  than  other  rates  by  a  carrier  on 
one  portion  of  its  line,  by  the  action  of  a  competitor,  and  in  which  it  is  without 
fault  itself,  under  the  operation  of  the  act  to  regulate  commerce,  can  not  be 
adopted  as  the  standard  as  to  other  rates  upon  a  far-distant  portion  of  its  line, 
where  no  such  exceptional  conditions  exist,  and  the  reasonableness  of  its  rate 
must  be  determined  by  altogether  ditferent  considerations. 

209.  Assurances  made  by  a  carrier  that  if  one  will  locate  in  business  on  the 
line  of  its  road  his  property  shall  be  taken  for  transportation  as  belonging  to  a 
specified  class,  can  not  bind  the  carrier  so  as  to  compel  a  classification  accord- 
ingly. A  right  to  special  rates  can  not  be  made  out  in  that  way;  the  classi- 
fication must  have  the  same  construction  in  favor  of  all  persons;  the  law 
requires  uniformity  and  impartiality  in  the  dealings  of  a  carrier  with  all 
persons. 

245.  A  leading  purpose  of  the  act  to  regulate  commerce  is  to  .prevent  the 
giving  of  unjust  preferences  and  advantages  as  between  localities,  in  railroad 
transportation.  This  purpose  would  be  defeated  if  any  one  carrier,  by  making 
unreasonably  low  rates  to  any  locality,  would  thereby  entitle  all  other  carriers 
competing  with  it  to  make  on  their  lines  greater  charges  upon  the  shorter  hauls 
to  other  stations  than  were  made  over  the  same  line  in  the  same  direction  to  the 
locality  thus  favored. 

253.  The  existing  arrangements  by  which  the  same  rate  is  charged  for  the 
transportation  of  milk  from  all  points  reached  by  the  regular  daily  milk  trains 
of  the  defendant  roads  found  to  be  not  illegal,  and,  on  the  whole,  to  be  the  best 
system  that  can  be  devised  for  the  general  good  of  all  interested  parties. 

257.  Where,  on  a  question  of  rates,  it  appears  that  higher  rates  are  made 
upon  the  shorter  hauls  on  the  same  line  and  in  the  same  direction,  the  carrier 
making  them  must  take  the  burden  of  proof  to  show  their  reasonableness. 

259.  The  offense,  under  section  2  of  the  act  to  regulate  commerce,  of  giving 
free  transportation  to  an  individual,  consists  in  the  charging,  demanding,  col- 
lecting, or  receiving  by  the  carrier  from  some  other  person  or  persons  a  com- 
pensation for  a  like  service,  when  none  is  contemporaneously  charged  or  received 
from  the  persons  thus  transported  free. 

261.  When  freight — for  example,  grain — is  hauled  to  the  seaboard  for 
export,  or  to  New  England  points,  from  the  northwestern  states  and  territo- 
ries of  the  American  "Union;  or  when  freight  is  hauled  from  the  seaboard  or 
New  England  points  to  the  northwestern  states  or  territories  through  the  cities 
of  Detroit  and  Chicago,  the  rule  invoked  by  the  petitioners  in  this  case  as  a 
basis  of  relief,  namely,  that  an  estimate  portion  of  this  through  rate  as  be- 
tween the  points  of  origin  of  the  freight  and  Detroit  must  not  be  lower  in  pro- 
portion to  distance  than  the  rate  upon  the  freight  from  such  points  of  origin 
destined  to  Detroit,  is  one  that  can  not  be  sustained. 

262.  Eates  must  be  relatively  fair  and  reasonable  as  between  localities  in 
essential  respects  similarly  situated,  not  according  to  any  rule  of  mathematical 
precision,  but,  in  substance  and  in  fact,  having  regard  to  the  geographical  and 
relative  positions  of  the  localities,  so  that  one  will  not  be  favored  to  the  unjust 
prejudice  of  the  other. 

265.  A  tariff  naming  a  rate  from  one  locality  lower  than  that  enjoyed  by  its 
neighbor,  wlien  the  circumstances  are  the  same,  tenders  a  preference  oi--advan- 
tage  to  the  lirst;  and  when  any  shipper  is  damaged  by  the  exaction  of  an  addi- 


ArPEXDIX. 


587 


tional  burden,  the  preference  becomes  undue  and  unreasonable,  unless  it  can  be 
justitied  upon  some  sound  und  substantial  ground. 

266.  Common  carriers  are  under  obligations  to  take  all  descriptions  of  ordi- 
nary traffic  from  all  points,  and  it  is  right  that  the  rates  should  be  known  and 
announced  publicly  in  advance  of  the  oflering  of  traffic. 

267.  Under  the  act  to  regulate  commerce,  sliippers  are  not  to  be  put  in  a 
position  of  subserviency  to  common  carriers,  nor  required  to  ask  for  rates,  but 
are  entitled  to  e(jual  and  open  rates  at  all  times. 

268.  Discriminations  are  made  and  undue  advantages  are  given  by  the 
special  tariifs  in  question,  in  giving  different  rates  to  places  named  and  those 
not  named;  to  manufactured  articles  named  and  those  not  named;  to  jobbers  at 
places  named  and  those  not  named;  to  manufacturers  and  to  jobbers  and 
other  dealers. 

271.  There  is  nothing  illegal  or  wrongful  in  a  railroad  company  making  a 
rate  for  immigrants  as  a  class,  and  declining  to  give  the  same  rate  to  others  for 
whom  different  accommodations  are  furnished. 

276.  Free  transportation  issued  in  the -form  of  an  annual  pass  to  a  person 
not  in'the  regular  and  stated  service  of  the  carrier,  nor  receiving  any  wages 
or  salary  under  a  contract  of  employment,  but  requested  by  him  as  compen- 
sation for  throwing  in  its  way  what  business  he  conveniently  could,  held  to 
be  illegal.  .  i      ■  , 

277.  In  deciding  a  case  against  one  or  more  carriers  who  are  charged  with 
making  rates  which  are  unjustly  discriminating  in  a  certain  line  of  traffic,  the 
decision  made  upon  the  facts  of  the  particular  case  does  not  necessarily  govern 
rates  in  other  sections  of  the  country  where  the  facts  bearing  upon  them  may  be 
altogether  different. 

292.  A  passenger-rate  war,  in  which  rates  were  repeatedly  reduced  by  sev- 
eral competing  lines  to  an  exceedingly  low  basis  on  a  particular  class  of  traffic, 
without  any  filing  of  tariff's,  was  contrary  to  the  requirements  of  law,  as  well  as 
against  the  true  interest  of  each  party  thereto. 

293.  Keductions  in  competitive  passenger  rates  can  not_  legally  be  made 
without  at  the  same  time  reducing  intermediate  rates,  as  required  by  the  fourth 
section  of  the  act.  ,  .  ■,    .      -a  j 

294.  No  necessity  or  compulsion  is  created  by  a  war  of  rates  which  justified 
disobedience  of  the  statute. 

295.  The  employment  of  ticket  brokers  and  scalpers  for  the  sale  of  railroad 
tickets  "placed  in  their  hands  to  be  disposed  of  at  reduced  rates  under  the  pre- 
tense of  paying  commissions  thereon,  held  illegal. 

296.  Kates  lower  than  the  established  tariff'  are  prohibited  by  law. 

297*.  Kates  obtained  from  ticket  brokers  lower  than  those  off'ered  at  the 
reo-ular  offices  of  the  company  effect  unjust  discrimination. 

°307.  The  rate  of  thirtv  and  one-half  cents  per  one  hundred  pounds  on  wheat, 
flour  and  mill  stuffs  from  Minneapolis  via  ililwaukee  to  New  York  and  com- 
mon'billing  points,  established  by  the  defendants  and  their  connecting  lines, 
February  f ,  1888,  was  a  through  rate. 

308.  The  percentage  amounting  to  twenty-five  cents  per  one  hundred 
pounds,  received  by  the  defendants  and  their  connecting  lines  east  of  Mil- 
waukee' as  their  proportion  of  this  through  rate  on  shipments  from  Minneapolis 
and  points  west  of  Milwaukee,  and  between  Milwaukee  and  Minneapolis  while 
the  defendants  charge  twenty-five  and  one-half  cents  per  one  hundred  pounds 
on  the  same  class  of  freight  originating  at  Milwaukee  and  transported  over 
their  lines  and  connecting  lines  to  eastern  points,  was  not  an  unjust  discrimi- 
nation against  Milwaukee,  nor  did  it  injure  the  business  of  Milwaukee,  nor 
was  it  a  violation  of  the  act  to  regulate  commerce  approved  February  4,  1887. 
312.  Through  rates,  like  any  other  agreements  that  parties  competent  to 
contract  may  make,  admit  of  very  great  variety  in  the  forms  they  assume;  and 
such  rates,  when  reasonable  and  fairly  adjusted,  in  their  relations  to  local 
business,  a're  greatly  favored  in  the  law  because  they  furnish  cheapened  rates 
and  greater  fa^cilities  to  the  public,  while  at  the  same  time  they  give  increased 
employment  and  earnings  to  a  larger  number  of  carriers. 


588  APPENDIX. 

323.  A  railroad  company  is  under  special  obligation  to  give  reasonable  rates 
for  its  local  business,  but  there  are  many  influences  which  may  aflect  through 
rates  while  not  bearing  upon  local  rates  at  all,  or,  if  at  all,  in  less  degree. 

324.  Through  rates  are  not  necessarily  illegal  which  when  divided  between 
carriers  give  them  less  than  their  local  rates,  provided  that  the  through  rate 
itself  is  not  less  than  some  one  of  the  locals,  or  unjustly  discriminating  against 
individuals  or  localities,  or  so  low  as  to  burden  other  business  with  part  of  the 
cost  of  the  business  upon  which  it  is  imposed. 

333.  A  departure  from  the  rule  of  equal  mileage  rates  as  applied  to  the 
several  branches  of  the  road  is  not  conclusive  that  such  rates  are  unlawful,  but 
the  burden  is  on  the  company  making  such  departure  to  show  its  rates  to  be 
reasonable  when  disputed. 

338.  A  group  rate  for  a  particular  district  upon  a  commodity  for  which  a 
large  demand  exists,  and  intended  to  place  producei-s  in  the  district  upon  an 
equality  among  themselves  and  with  producers  of  the  same  commodity  from 
other  districts,  all  competing  in  a  common  market,  is  not  unlawful  merely  on 
account  of  differences  in  the  geographical  location  of  different  producers  and 
their  respective  distances  from  the  market. 

339.  Actual  undue  prejudice  or  damage  of  which  the  rate  is  the  cause  must 
result  to  the  more  favorably-situated  producers  to  render  a  group  rate  unlawful. 

340.  In  determining  the  question  of  undue  prejudice  from  a  rate,  distance  is 
onlv  one  of  the  factors,  and  other  material  facts,  such  as  character  and  quality 
of  the  commodity,  cost  of  production,  extent  and  nature  of  the  competition  in 
the  business  itself  by  other  transportation  lines,  and  the  interests  of  the  pubhc 
in  the  use  of  the  commodity  and  its  market  cost  are  to  be  considered. 

848.  Mileage,  excursion,  or  commutation  passenger  tickets  must  be  offered 
impartially  to  all  who  accept  the  conditions  on  which  they  are  issued,  and  the 
rates  at  which  they  are  sold  must  be  published.  The  general  requirements  of 
the  act  to  regulate  commeree  as  amended  are  as  applicable  to  these  classes  of 
tickets  as  to  any  others. 

349.  Party  rates  and  passengers'  car-load  rates  lower  than  contemporaneous 
rates  for  single  passengers  constitute  discrimination  between  persons  entitled  to 
transportation  at  equal  rates,  and  are  therefore  illegal. 

359.  The  provisions  of  the  act  to  regulate  commerce  apply  to  foreign  as 
well  as  domestic  common  carriers  engaged  in  the  transportation  of  passengers  or 
property,  for  a  continuous  carriage  or  shipment,  from  a  place  in  the  United 
States  to'a  place  in  an  adjacent  foreign  country. 

860.  The  common  carriers  engaged  in  such  transportation  are  subject  to  the 
provisions  of  the  act  in  respect  to  the  printing  of  scliedules  of  rates,  fares,  and 
charges  for  the  traflic  they  carry,  the  posting  and  filing  with  the  Interstate 
Commerce  Commission  of  copies  of  such  schedules,  the  notice  of  advances  and 
reductions,  and  the  maintenance  of  the  rates,  fares,  and  charges  established  and 
published  and  in  force  at  the  time. 

362.  The  carriage  of  freights  can  not  be  prevented  from  being  treated  as  one 
continuous  carriage  from  the  place  of  shipment  to  the  place  of  destination  by 
any  means  or  devices  intended  to  evade  any  of  the  provisions  of  tlie  act. 

367.  It  is  a  lawful  duty  that  a  carrier,  like  the  defendant,  owes  to  the  travel- 
ing public,  in  carrying  out  its  rule  of  furnishing  separate  cars  to  white  and 
colored  passengers  on  its  line  engaged  in  interstate  travel,  to_  make  them  equal 
in  comforts,  acconnaodation,  and  equipment,  without  any  discrimination. 

368.  It  is  a  lawful  duty  which  a  carrier,  like  the  defendent,  owes  to  the 
traveling  public,  engaged  in  interstate  travel  over  its  line,  to  afford  the  equal 
protection  of  the  law  alike  to  all  such  passengers,  without  regard  to  race,  color, 
or  sex,  against  undue  prejudice  and  disadvantage  from  disorderly  conduct  on 
the  part  of  other  passengers  or  persons. 

370.  When,  pending  a  proceeding  begun  to  test  the  reasonableness  of  rates, 
the  rates  are  reduced  and  nnide  satisfactory  to  the  complainants,  the  Commission 
will  not  consider  the  question  whether  the  rates  before  reduction  were  or  were 
not  excessive;  that  question  having  by  reduction  made  become  purely 
abstract  and  speculative. 


APPENDIX.  589 

392.  "When  rates  on  the  line  of  a  carrier  are  on  their  face  disproportionate 
or  relatively  unequal,  the  burden  is  on  the  carrier  to  justify  them  when 
challenged. 

393.  Grain,  and  grain  products,  classified  alike,  are  presumptively  entitled 
to  equal  rates,  and  if  a  difference  is  made  by  a  carrier  it  assumes  the  burden  of 
sustaining  it  by  satisfactory'  evidence. 

395.  A  practice  has  existed  on  the  part  of  certain  carriers  of  live  cattle  to 
make  a  car-lead  rate  irrespective  of  weight,  leaving  the  shipper  to  load  into  the 
car  as  manv  cattle  as  he  pleased  and  was  able  to  put  into  it.  The  carriers  sub- 
stituted for  this  practice  the  rule  that  while  naming  a  car-lot  rate  they  pre- 
scribed a  minimum  weight  for  a  car-load,  and  then  charged  by  the  hundred 
pounds  in  proportion  to"  the  car-lot  rate  for  any  excess  over  the  minimum. 
Held  that  this  rule  was  not  unlawful. 

414:.  A  discrimination  between  the  rate  on  corn  and  its  direct  products  from 
a  given  locality  resulting  from  a  reduction  of  the  rate  on  corn  below  the  rate 
on  its  direct  products,  which  subjected  persons  in  that  locality  engaged  in  the 
business  of  manufacturing  corn  into  its  direct  products,  and  of  selling  the  same, 
to  unreasonable  prejudice  or  disadvantage,  and  was  without  necessity  or 
advantage  to  the  carrier,  or  any  reason  founded  on  the  character  or  condition 
of  the  tralfic.  Held  to  be  in  violation  of  section  three  of  the  act  to  regulate 
commerce,  notwithstanding  the  new  rate  on  corn  was  open  to  all  persons  equally 
and  with  equal  service. 

420.  Classification  of  freight  for  transportation  purposes  is  in  terms  recog- 
nized by  the  act  to  regulate  commerce,  and  is  therefore  lawful.  It  is  also  a 
valuable  convenience  both  to  shippers  and  carriers. 

421.  A  classification  of  freight  designating  difl'erent  classes  for  car-load 
quantities  for  transportation  at  a  lower  rate  in  car-loads  than  in  less  than  car- 
loads is  not  in  contravention  .of  the  act  to  regulate  commerce.  The  circum- 
stances and  conditions  of  the  transportation  in  respect  to  the  work  done  by  the 
carrier  and  the  revenue  earned  are  dissimilar,  and  may  justify  a  reasonable 
difference  in  rate.  The  public  interests  are  subserved  by  car-load  classifica- 
tions of  property  that,  on  account  of  the  volume  transported  to  reach  markets 
or  supply  the  demands  of  trade  throughout  the  country,  legitimately  or 
usually  moves  in  such  quantities. 

422.  Carriers  are  not  at  liberty  to  classify  property  as  a  basis  of  transporta- 
tion rates  and  impose  charges  for  its  carriage  with  exclusive  regard  to  their 
own  interests,  but  they  must  respect  the  interests  of  those  who  may  have 
occasion  to  employ  their  services  and  conform  their  charges  to  the  rules  of 
relative  equality  and  justice  which  the  act  prescribes. 

423.  Cost  of  service  is  an  important  element  in  fi.xing  transportation  charges 
and  entitled  to  fair  consideration,  but  is  not  alone  controlling  nor  so  applied  in 
practice  by  carriers,  and  the  value  of  the  service  to  the  property  carried  is  an 
essential  factor  to  be  recogni;?('d  in  connection  with  other  considerations.  The 
public  interests  are  not  to  be  subordinated  to  those  of  carriers,  and  require 
proper  regard  for  the  value  of  the  service  in  the  apportionment  of  all  charges 
upon  traific. 

424.  A  difference  in  rates  upon  car-loads  and  less  than  car-loads  of  the  same 
merchandise  between  the  same  points  of  carriage  so  wide  as  to  be  destructive  to 
competition  between  large  and  small  dealers,  especially  upon  articles  of  general 
and  necessary  use,  and  which,  under  existing  conditions  of  trade,  furnish  a  large 
volume  of  business  to  carriers,  is  unjust  and  violates  the  provisions  and  princi- 
ples of  the  act. 

42-5.  A  difference  in  rate  from  a  solid  car-load  of  one  kind  of  freight  from 
one  consignor  to  one  consignee,  and  a  car-load  quantity  from  the  same  point  of 
shipment'to  the  .same  destination  consisting  of  like  freight  or  freight  of  like 
character  from  more  than  one  consignor  to  one  consignee,  or  from  one  consignor 
to  more  than  one  consignee,  is  not  justified  by  the  difference  in  cost  of  handling. 

428.  It  was  a  regulation  of  the  respondent  company,  published  on  its  public 
tariff'  schedules  filed  and  posted  as  required  by  the  act  to  regulate  commerce, 


590  APPENDIX. 

that  the  conductor  should  collect  fare  on  trains  from  passengers  without  tickets 
by  adding  twenty -five  cents  to  single-trip  rates,  held  that  it  was  not  unjust  dis- 
crimination against  the  complainant  to  exact  this  addition  from  him. 

433.  When  questions  involve  the  reasonableness  of  rates  upon  the  transpor- 
tation of  cotton  from  the  southern  states  by  all  rail  lines  to  northern  and  eastern 
mills  and  Atlantic  ports  upon  through  rates  and  a  long  haul,  on  the  one  hand, 
and,  on  the  other,  the  local  rates  of  rail  carriers  to  a  near  port  upon  a  short 
haul  at  which  their  service  terminates,  they  having  no  associated  line  of  steam- 
ships for  a  continuous  carriage  to  ultimate  destination,  but  the  cotton  so  carried 
by  them  to  such  near  port  being  chiefly  for  export,  and  all  such  rail  lines  pene- 
trating the  same  territory  and  competing  for  the  same  business,  running  north, 
south,  and  east  in  opposite  directions,  such  questions  can  only  be  disposed  of  on 
broad  lines  and  not  from  narrow  considerations. 

434.  In  considering  such  questions  thus  presented,  the  circumstances  and 
conditions  surrounding  the  traffic  in  the  respective  services  performed  in  its 
carriage  by  the  rail  carriers  may  be,  and  in  these  proceedings  are  found  to  be, 
substantially  dissimilar  and  wholly  unlike. 

438.  In  solving  questions  of  this  character  the  Commission  will  look  at  and 
consider  every  fact,  circumstance,  and  condition  surrounding  the  traffic  and  of 
theservice  performed  in  its  transportation,  and  if  the  competition  of  water  carriers 
at  any  point  is  such  as  to  be  large,  active,  and  of  controlling  force,  the  all-rail 
lines  competing  for  the  traffic  at  the  same  point  may  make  rates  that  are  reason- 
able and  just  in  view  of  such  competition,  and  which  will  enable  them  to 
participate  in  the  carriage  of  the  traffic,  and  are  not  obliged  to  go  out  of  the 
business  and  leave  it  as  a  monopoly  to  water  carriers. 

452  Where  a  common  carrier  subject  to  the  act  to  regulate  commerce  has 
established  and  published  its  schedule  of  rates  and  charges  for  a  station  on  its 
line  free  cartage  furnished  by  the  carrier  for  the  collection  and  delivery  of 
freight  carried  on  its  road  to  or  from  such  stations  operates  as  a  reduction  or 
rebate  from  the  schedule  charge  and  is  unlawful.  If  free  cartage  at  a  station 
has  the  effect  to  reduce  a  rate  below  the  charge  at  another  station  nearer  the 
point  of  shipment  it  is  unlawful  as  a  less  charge  for  a  longer  distance  over  the 
same  line  and  in  the  same  direction,  the  less  being  included  within  the  greater. 

458.  Where  a  carrier  by  its  published  general  traffic  charges  the  general 
public  from  and  to  all  points  upon  a  large  portion  of  its  lines  certain  rates  upon 
a  class  of  freight,  and  at  the  same  time  publishes  and  puts  into  force  a  special 
tariff  by  which  it  charges  a  class  of  persons  named,  from  and  to  the  same  points 
on  its  lines  less  than  one-half  in  amount  of  the  rates  on  the  same  class  of  freight 
that  it  charges  the  general  public  in  its  general  tariffs,  such  a  discrimination  is 
unjust  and  i's  violative  of  the  act  to  regulate  commerce. 

459.  Such  a  discrimination  can  not  be  sustained  upon  the  ground  that  the 
specialtariff  is  made  to  aid  "  emigrants  "  in  moving  from  one  state  to  another 
where  land  is  cheap,  and  to  develop  a  sparsely  settled  country,  and  to  build  up 
business  along  the  carrier's  lines,  and  upon  the  supposition  that  this  constitutes 
substantially  dissimilar  circumstances  and  conditions  to  what  exists  when 
similar  services  are  rendered  by  the  carrier  for  the  general  public. 

465.  In  arranging  the  classification  of  articles  of  commerce  their  market 
value  and  the  shipper's  representations  to  the  public  as  to  their  character  may 
properly  be  taken  into  account  in  ascertaining  the  analogy  they  bear  to  other 
articles,  and  determining  the  class  to  which  they  justly  belong.  This  is  espe- 
cially applicable  to  articles  in  which  there  is  no  free  competition  among  producers 
and  shippers.  And  carriers  are  not  required  to  estimate  the  intrinsic  value  of 
freight  as  distinguished  from  its  commercial  value  for  purposes  of  classification 
and   rates.  ... 

466.  The  volume  of  traffic  supplied  by  an  article  for  transportation  is  also 
an  element  that  may  be  considered  in  its  classificatiim,  as  a  basis  for  rates  that 
arc  reasonable  both  "for  carriers  and  shippers. 

468.  A  lower  charge  for  a  longer  distance  for  transportation  of  like  trathc 
important  in  amount;  and  among  the  circumstances  and  conditions  that  may 


i 


APPENDIX.  691 

be  considered  in  estimating  the  dissiiuihirity  created  by  water  competition  are 
the  character  of  the  roads,  the  character  of  the  traffic,  the  preponderance  of 
empty  cars  moving  in  a  direction  in  which  the  traffic  must  be  taken,  and  the 
legitimacy  of  the  competition  by  the  rail  earner. 

569.  The  transportation  of  traffic  under  circumstances  and  conditions  that 
force  a  low  rate  for  its  carriage,  or  an  abandonment  of  the  business,  but  which 
affords  some  revenue  above  the  cjst  of  its  movement,  and  works  no  material 
injustice  to  other  patrons  of  a  carrier,  is  to  be  deemed  legitimate  competiti(ni. 
When,  however,  its  carriage  is  at  a  loss,  and  imposes  a  burden  on  like  traffic  at 
other  points,  and  on  other  traffic,  it  is  to  be  deemed  destructive  and  illegitimate 
competition. 

470.  Kates  can  not  bo  arbitrarily  charged  in  the  mere  discretion  of  a 
carrier.  They  are  to  be  equitably  adjusted  with  regard  to  the  public  interests 
as  well  as  the  carriers,  lleduced  rates  at  points  where  competitive  influences 
are  controlling  must  not  fall  below  some  revenue  from  the  traffic  in  excess  of 
cost,  and  higher  rates  at  other  points,  required  for  the  necessary  revenue  of  a 
carrier,  must  be  reasonable  in  themselves,  and  also  relatively  reasonable  in 
comparison  with  the  competiti\^e  rate. 

472.  Where  a  reduced  rate  is  made  at  the  terminus  of  a  through  route, 
under  the  compulsion  of  competition,  a  town  not  located  on  the  line  of  the 
through  route,  but  reached  over  a  lateral  connecting  road,  has  a  disadvantage 
of  situation  entailing  some  additional  expense,  and  a  reasonably  higher  rate  to 
such  town  than  the  forced  competitive  rate  to  the  more  distant  terminus  of 
the  through  route  is  not  unjust  discrimination. 

474.  A  manufacturer's  description  of  an  article  to  induce  its  purchase  by 
the  public  also  describes  it  for  transportation,  and  carriers  may  accept  his 
description  for  purposes  of  classification  and  rates.  Carriers  are  not  required  to 
analyze  freight  to  ascertain  whether  it  is  in  fact  inferior  to  the  description  or 
public  representations  under  which  it  is  sold,  in  order  to  give  it  a  lower  rate 
corresponding  to  its  actual  value. 

476.  The  rate  of  compensation  which  railroad  companies  may  lawfully 
receive  for  transportation  services  can  not  be  so  limited  that  the  shipper  may  in 
all  cases  realize  actual  cost  of  production. 

477.  Ciiarges  for  transportation  service  should  have  reasonable  relation  to 
cost  of  production  and  to  the  value  of  the  service  to  the  producer  and  shipper, 
but  should  not  be  so  low  on  any  as  to  impose  a  burden  on  other  traffic. 

478.  In  the  carriage  of  great  staples,  which  supply  an  enormous  business 
and  which  in  market  value  and  actual  cost  of  transportation  are  among  the 
cheapest  articles  of  commerce,  rates  yielding  only  moderate  profit  to  the  carrier 
are  both  necessary  and  justifiable,  and  where  the  carriers  frequently  put  in  force 
and  continue  for  considerable  periods  of  time  tariifs  of  rates  and  charges,  it  is  a 
fair  inference  that  such  rates  and  charges  are  profitable. 

484.  In  fixing  reasonable  rates,  the  requirements  of  operating  expenses, 
bonded  debt,  fixed  charges,  and  dividend  on  capital  stock  from  the  total  traffic 
are  all  to  be  considered,  but  the  claim  that  any  particular  rate  is  to  be  measured 
by  these  as  a  fixed  standard,  below  which  the  rate  may  not  lawfully  be  reduced, 
is  one  rightly  subject  to  some  qualifications,  one  of  which  is  the  obligations 
must  be  actual  and  in  good  faith. 

514.  The  mere  fact  that  one  article  is  of  more  general  use  and  therefore 
shipped  in  greater  quantities  than  another,  when  each  as  a  rule  is  shipped  in  less 
than  car-load  quantities,  and  of  no  considerable  difference  in  bulk,  weight,  and 
value,  and  of  no  appreciable  difference  in  expense  of  handling  and  of  haul, 
constitutes  in  itself  no  reason  why  the  first  should  receive  a  lower  rate  than  the 
last.  In  such  a  case  mere  quantity,  not  measured  by  any  recognized  unit  of 
quantity  adapted  to  carriage,  and  lessoning  the  expense  of  handling  and 
carriage,  cannot  be  allowed  to  affect  rates  in  the  transportation  of  property. 

522.  A  line  of  steamships  plying  between  New  York  and  Boston  every 
other  day  makes  the  distance  in  twenty-four  hours,  does  the  largest  part  of  the 
carrying  trade  of  the  grocers  of  Boston  on  shipments  from  New  York,  carries 


592  APPENDIX. 

flour  from  New  York  to  Boston  for  eight  and  one-half  cents  per  one  hundred 
pounds;  other  lines,  part  water  and  part  rail,  known  as  the  "  Sound  Lines," 
make  daily  trips  between  New  York  and  Boston,  and  carry  flour  from  New 
York  to  Boston  at  nine  cents  per  hundred  pounds  ;  an  all-rail  line  composed  of 
the  lines  of  the  defendants  upon  through  billing  and  through  rates  to  Boston 
alone  on  shipments  from  New  York,  makes  daily  runs  between  these  points  and 
carries  flour  from  New  York  to  Boston  at  nine  cents  per  hundred  pounds.  Each 
and  all  of  these  carriers  are  in  actual  competition  for  this  business,  and  it 
involves  the  carriage  of  trafiic  important  in  amount.  Held,  upon  the  facts,  that 
this  is  a  case  in  which  the  circumstances  and  conditions  in  the  carriage  of  this 
commodity  are  substantially  dissimilar  at  Boston  to  what  they  are  at  Keadville, 
an  interior  town  about  eight  miles  from  Boston,  on  the  line  of  the  all-rail 
carriers,  where  no  competition  exists  between  the  all-rail  carriers  and  the  water- 
lines,  and  justifies  the  all-rail  carriers  in  meeting  the  rate  by  the  water-line  at 
Boston,  bv  charging  nine  cents  per  hundred  pounds  on  flour,  while  the  com- 
bined local  rates  of  the  two  rail  carriers  are  higher  upon  shipments  of  this  kind 
of  freight  from  New  York  to  Eeadville  than  they  are  upon  the  joint  through 
rate  from  New  York  to  Boston. 

561.  Classification  of  freight.  Freight  classification  is  deemed  by  the  rail- 
roads convenient  and  essential  to  any  practical  system  of  rate-making,  and  is  so 
recognized,  though  not  enjoined  by  the  act  to  regulate  commerce. 

562.  Same.  When  classification  is  used  as  a  device  to  eflfect  unjust  discrim- 
ination or  as  a  means  of  violating  other  provisions  of  the  statute,  the  act 
requires  the  Commission  to  so  revise  and  correct  such  classification  and  arrange- 
ment as  to  correct  the  abuse. 

581.  For  a  special  service  by  a  carrier,  such  as  the  transportation  of  perish- 
able freight  requiring  quick  movement,  prompt  delivery  at  destination,  special 
fitting  up  of  cars,  th'eir  withdrawal  from  other  service,  and  their  return  empty 
on  fast  time,  all  involving  greater  expense  to  the  carrier,  a  higher  rate  than  for 
the  carriage  of  ordinary  freight  is  warranted  by  the  conditions  of  the  service, 
and  is  reasonable  and  just. 

582.  But  the  higher  rate  for  a  special  service  should  bear  a  just  relation  to 
the  value  of  the  service  to  the  traflic,  and  is  not  wholly  in  the  discretion  of  the 
carrier.  While  a  carrier  should  be  fully  compensated,  the  public  interests 
require  that  the  traflBc  should  not  be  rendered  valueless  to  the  producer  if  the 
charges  of  the  carrier  have  such  an  eft'ect  and  can  be  reasonably  reduced. 

583.  The  requirement  of  the  statute  that  all  rates  shall  be  reasonable  and 
just  involves  a  consideration  of  the  commercial  value  of  the  traffic,  and  implies 
"that  rates  should  be  so  adjusted  that  producers  of  traffic,  as  well  as  carriers,  may 
carry  on  their  pursuits  successfully,  if  practicable  for  both,  and  without  injus- 
tice to  the  carrier.  The  public  good  requires  what  is  plainly  the  spirit  of  the 
law,  that  the  transportation  interests  are  not  alone  to  be  considered,  but  that 
in  the  just  exercise  of  regulation  care  should  be  taken  that  the  lawful  and 
necessary  occupations  of  citizens  are  not  unjustly  burdened. 

586.  "The  relation  of  rates  ought  to  rest  upon  fixed  and  stable  conditions. 
The  fluctuations  of  markets  are  so  frequent,  especially  as  to  competitive 
articles,  and  oftentimes  unexpected,  that  commercial  considerations  alone  would 
not  furnish  a  sufficiently  stable  and  fixed  rule  for  guidance  in  making  a  rate 
that  should  remain  substantially  permanent  through  all  fluctuations.  The 
Commission  does  not,  by  a  fixing  of  rates,  attempt  to  overcome  advantages 
wliich  one  producer  or  dealer  may  have  in  his  geographical  location,  and  to 
produce  equality  between  competitors  in  all  markets.  It  would  be  a  useless 
task,  even  if  it  had  the  power,  to  attempt  to  accomplish  such  a  result.  The 
proper  relation  of  rates  for  transportation  of  strictly  competitive  articles  oyer 
the  same  line  should  be  determined  by  reference  to  respective  costs  of  service 
ascertained  with  reasonable  accuracy. 

587.  Violation  by  one  carrier  of  principles  laid  down  in  this  case  as  govern- 
ing relative  rates  (m  competitive  articles  does  not  justify  similar  violations  by  its 
competitors. 


APPENDIX.  593 

589.  A  firm  of  cattle  dealers  in  the  city  of  New  York,  who  procured  their 
cattle  on  a  large  scale  from  Chicago  and  other  western  points  for  domestic 
consumption  as  well  as  for  export,  make  an  arrangement  with  two  interstate 
rail  carriers,  constituting  a  through  line  from  Chicago  to  New  York,  that  the 
said  firm  will,  under  a  name  of  an  express  company  of  their  own  creation, 
furnish  not  less  than  two  hundred  or  more  than  four  hundred  improved  live- 
stock cars  for  the  transportation  of  these  cattle.  For  the  rental  of  these  improved 
stock  cars  the  carriers  pay  this  express  company  three-fourtlis  of  a  cent  per 
mile  whether  loaded  or  empty.  Extraordinary  facilities  and  rights  of  way  are 
given  these  cars  to  enable  them  to  make  a  large  mileage,  and  they  make  more 
than  twice  the  mileage  of  ordinary  stock  cars.  Besides  this,  the  carriers  pay 
fifty  cents  for  the  loading  of  each  of  said  cars  with  cattle  at  the  Union  Stock 
Yards  in  Chicago,  for  which  no  charge  is  made  against  the  express  company  or 
the  firm  represe'nted  by  it.  In  addition  to  this  the  carriers  pay  this  firm  yard- 
age at  the  rate  of  three  and  one-half  cents  per  hundred  pounds  on  all  their 
cattle,  and  upon  all  other  cattle  handled  for  other  firms  in  the  care  of  this  firm 
owning  the  express  company,  to  its  yards  at  pier  forty-five,  East  Kiver.  This 
yardage  charge  is  thus  paid  to  the  said  firm  by  the  said  carriers  for  keeping 
their  cattle  in  the  firm's  own  yards  after  delivery  of  them  to  the  firm,  and  then 
this  yardage  charge  is  deducted  from  the  tariff  rate  charged  by  the  carrier. 
The  amount  of  these  rebates  to  this  firm  in  rates  on  these  cattle  by  these  carriers 
more  than  pays  the  entire  cost  of  the  improved  stock  cars  within  two  years  after 
operations  are  commenced  with  them,  including  the  expenses  of  operation,  leaving 
said  firm  owning  the  cars  and  still  operating  them  with  all  these  advantages, 
and  rates,  and  facilities.  Held  :(1)  This  is  an  unlawful  preference  to  the  firm  own- 
ing these  improved  stock  cars  and  a  violation  of  the  act  to  regulate  commerce. 
(2)  It  is  an  unlawful  and  unjust  prejudice  to  other  cattle  firms  and  dealers  in 
New  York  who  are  competitors  in  the  business  of  said  firm  owning  said  im- 
proved stock  cars. 

595.  Same  rate  for  longer  and  shorter  distances.  Ordinarily  longer  distances 
warrant  higher  charges,  but  carriers  may  lawfully  accept  the  same  aggregate, 
though  less  profitable,  rates  for  longer  distances,  provided  such  carriers  do  not 
"  subject  any  particular  person,  company,  firm,  corporation,  or  locality,  or  any 
particular  description  of  traffic,  to  any  undue  or  unreasonable  prejudice  or 
disadvantage." 

609.  For  the  carrier  to  pay  the  larger  expense  of  the  transportation  of  a 
remote  shipper's  merchandise  to  the  station,  and  not  to  pay  the  less  expense  of 
such  transportation  of  the  nearer  shipper's  merchandise,  would  be  the  equivalent 
of  a  rebate  to  the  former,  the  railroad  service  proper  being  the  same  to  each  and 
at  the  same  rate;  nor  would  it  be  treating  all  patrons  with  statutable  equality 
to  bear  a  part  of  the  cartage  expenses  for  one  shipper  and  not  bear  a  part  of  it 
for  -mother. 

S20.  The  possible  influence  of  water  competition  upon  rates  for  the  trans- 
portation of  oranges  and  the  nonexistence  of  such  competition  in  the  carriage  of 
berries,  because  the  latter  can  not  be  carried  by  water  in  any  considerable 
quantities,  does  not  authorize  defendants  to  take  advantage  of  the  situation  and 
charge  unreasonable  rates  on  berries. 

632.  Comparison  with  rates  in  other  localities  where  dissimilar  conditions 
and  modifying  circumstances  are  found  is  not  sufficient  to  establish  the  unreason- 
ableness of  the  charges  complained  of.  When  no  discrimination  is  alleged  as 
between  points  of  production  tributary  to  the  same  market,  or  on  account  of 
disproportionate  rates  on  different  kinds  of  traffic  similar  in  character  and 
volume,  it  must  affirmatively  appear  that  the  charges  assailed  are  unreasonable 
and  ought  to  be  reduced. 

637.  The  Commission  possesses  no  authority  to  compel  carriers  subject  to 
its  jurisdiction  to  provide  any  particular  kind  of  cars  or  other  special  equipment, 
but,  in  the  absence  of  adequate  equipment  freely  afi'orded  to  all  patrons  alike, 
carriers  should  so  adjust  rates  between  those  who  can  not  furnish  their  own 
conveyance  that  in  the  relative  charges  to  each  there  shall  be  no  discrimination 
against  the  dependent  shipper. 

38 


594  APPENDIX. 

657.  The  continued  reduction  of  relative  rates  when  brought  about  by  the 
removal  of  artificial  and  unnatural  ditferences  is  not  undesirable,  but  where  the 
ditference  results  from  dissimilar  circumstances  and  conditions  and  the  true 
difficulty  appears  to  be  a  real  and  natural  advantage  which  the  one  region  has 
and  enjoys  over  the  other,  such  continuing  disturbances  of  rates  ought  not  to 
be  inaugurated,  especially  when  the  charges  are  commodity  rates  not  shown  to 
be  unreasonable  in  themselves. 

652.  Salt  requires  and  gets  a  commodity  rate  lower  than  class  rates,  and  the 
roads  should  only  be  limited  as  to  such  lower  rating  by  the  rule  that  a  commod- 
ity shall  not  be  carried  at  such  unremunerative  rates  as  will  impose  burdens 
upon  other  articles  transported  to  recoup  loss  incurred  in  carrying  that 
commodity. 

655.  That  rates  should  be  fixed  in  inverse  proportion  to  the  natural  advan- 
tages of  competing  towns  with  the  view  of  equalizing  "commercial  condi- 
tions," as  they  are  "sometimes  described,  is  a  proposition  unsupported  bylaw, 
and  quite  at  variance  with  every  consideration  of  justice.  Each  _  community  is 
entitled  to  the  benefits  arising  from  its  location  and  natural  conditions,  and  the 
exaction  of  charges  unreasonable  in  themselves  or  relatively  unjust,  by  which 
those  benefits  are  neutralized  or  impaired,  contravenes  alike  the  provisions  and 
the  policy  of  the  statute. 

663.  The  competition  of  carriers  subject  to  the  act  to  regulate  commerce 
does  not  create  circumstances  and  conditions  which  the  carriers  can  take  into 
account  in  determining  for  themselves  in  the  first  instance  whether  they  are 
justified  under  the  fourth  section  in  charging  more  for  shorter  than  for  longer 
distances  over  their  lines. 

664.  The  competition  of  markets  on  different  lines  for  the  sale  of  commodi- 
ties at  a  given  point  served  by  both  lines  does  not  create  circumstances  and 
conditions  which  the  carriers  can  take  into  account  in  determining  for  them- 
selves in  the  first  instance  whether  they  are  justified  under  the  fourth  section  in 
charging  more  for  shorter  than  for  longer  distances  over  their  lines.  To  deter- 
mine the  force  and  effect  of  such  competition  involves  consideration  of  com- 
mercial questions  peculiar  to  the  business  of  shippers,  such  as  advantage  of 
business  location,  comparative  economy  of  production,  comparative  quality  and 
market  value  of  commodities,  all  of  which  are  entirely  disconnected  from  cir- 
cumstances and  conditions  under  which  transportation  is  conducted.  Carriers 
can  not  create  abnormal  situations  by  making  rates  which  equalize  advantages 
and  disadvantages  of  localities  and  thereupon  claim  justification  for  greater 
charges  on  shorter  hauls  on  the  ground  that  the  lesser  long-haul  charges  which 
accomplish  such  equalization  are  necessary  to  secure  increase  in  traffic  over 
their  lines. 

665.  The  carrier  has  the  right  to  judge  in  the  first  instance  whether  it  is 
justified  in  making  the  greater  charge  for  the  shorter  distance  under  the  fourth 
section  in  all  cases  where  the  circumstances  and  conditions  arise  wholly  upon 
its  own  line  or  through  competition  for  the  same  traffic  with  carriers  not  sub- 
ject to  regulations  under  the  act  to  regulate  commerce.  In  other  cases  under 
the  fourth  section  the  circumstances  and  conditions  are  not  presumptively  dis- 
similar and  carriers  must  not  charge  less  for  the  longer  distance  except  upon  the 
order  of  this  Commission. 

669.  Ownership  of  a  car  rented  to  a  carrier  and  for  the  use  of  which  the 
carrier  pays  a  full  consideration  does  not  of  itself  entitle  the  owner  to  the 
exclusive  use  of  such  car,  and,  if  the  owner  may  in  the  contract  of  hire  to  the 
carrier  stipulate  for  the  exclusive  use  of  the  car,  it  must  be  upon  such  terms  as 
shall  not  constitute  an  unjust  discrimination  against  shippers  of  like  traffic  in 
cars  owned  by  the  carrier  and  who  are  excluded  from  the  use  of  the  car  so 
hired. 

676.  Transportation  by  rail  from  eastern  points  to  the  "Pacific  Coast 
terminals,"  Portland,  Tacoma,  and  Seattle,  is  attected  by  the  competition  of 
controlling  force  and  in  respect  to  traffic  important  in  amount,  of  water  carriers 
reaching  the   same  terminals,  but  such  competition  does  not  affect  like  trans- 


AI'l'ENDIX.  595 

portation  from  said  points  to  the  city  of  Spokane,  "Wash.  Held,  therefore,  that 
defendants  «ire  justified,  by  reason  of  such  dissimilarity  in  circumstances  and 
conditions,  in  maintaining  higher  rates  on  shipments  of  like  property  from  said 
points  for  the  shorter  distance  to  Spokane  than  for  the  longer  distance  to  said 
Pacific  terminals. 

The  competitive  position  and  attitude  of  the  Canadian  Pacific  Kaihvay,  a 
foreign  carrier,  considered  in  connection  with  existing  water  competition, "hut 
the  separate  eftcct  of  competition  by  the  Canadian  route  not  found  or 
determined. 

681.  Continuance  of  a  system  of  unjust  rates  can  not  be  re([uired  or  excused 
on  the  ground  that  parties  have  made  investments,  and  entered  into  the  business 
affected  thereby  on  the  faith  of  assurances  from  carriers  of  their  maintenance, 
although  a  change  might  work  injury  to  the  parties  whom  such  rates  had  unduly 
favored. 

682.  An  advantage  resulting  from  just  rates,  coupled  with  the  enterprise 
and  outlay  necessary  to  utilize  them,  is  legitimate,  and  carriers  should  not 
undertake  to  deprive  a  shipper  of  this  advantage  by  a  change  of  such  rates. 

688.  In  passing  upon  the  reasonableness  of  rales,  the  question  whether  they 
afford  the  carrier  a  proper  return  for  the  service  rendered  is  to  be  considered 
us  well  as  the  result  of  the  business  to  the  shipper  or  producer  of  the  traffic. 

694.  When  great  disparity  exists  between  charges  which  are  lower  to 
competitive  than  to  intermediate  points  much  less  remote,  the  inference  is 
irresistible  that  the  lower  rate  must  be  unremunerative  upon  any  theory,  or  else 
the  larger  rate  gives  unwarranted  return  for  the  service  rendered. 

696.  A  town  favorably  situated  with  respect  to  one  through  route,  but 
competing  in  a  common  market  with  another  town  more  favorably  located  on 
another  through  route,  should  not  have  a  reduction  of  the  local  rate  over  roads 
connecting  the  two  through  routes  for  the  purpose  of  overcoming  the  natural 
advantage  which  the  latter  competing  town  enjoys. 

704.  Manufacturing  industries  should  not  be  depi'ived,  through  a  carrier's 
adjustment  of  relative  rates,  of  advantages  resulting  from  their  favorable 
location  in  respect  of  cost  of  raw  material  supplied  from  a  common  source,  or 
of  distance  to  the  common  market  for  the  finished  product. 

709.  Unreasonable  or  unjust  classification  of  a  commodity  is  not  shown  by 
evidence  of  lower  classification  for  articles  widely  dissimilar  in  the  elements  of 
risk,  weight,  bulk,  value,  or  general  character.  The  proper  method  of  com- 
parison is  the  classification  accorded  b}^  the  carriers  to  analogous  articles. 

722.  The  facts  that  one  city  is  much  larger  and  has  more  important  and 
extensive  business  interests  than  another,  and  has  been  treated  by  the  carriers 
in  making  rates  to  surrounding  points  as  a  "trade  center,"  is  no  justification 
for  a  continuation  of  discriminatory  rates  in  favor  of  such  city.  The  object  of 
the  act  to  regulate  commerce  was  to  eradicate  the  existing  system  of  rebates  and 
unjust  discriminations  in  favor  of  particular  localities,  special  enterprises,  and 
favored  individuals. 

732.  When  an  article  of  traffic  does  not  move  on  account  of  burdensome 
rates  and  the  carrier  is  hauling  a  considerable  number  of  empty  cars  in  the 
direction  such  article  would  naturally  move  if  accorded  a  lower  rate,  the  carrier 
may  be  justified  in  carrying  at  a  rate  sufficient  to  induce  the  movement  of  such 
traffic,  provided  no  extra  or  additional  charge  is  in  consequence  put  upon  other 
articles  carried ;  but  the  fact  that  freight  will  furnish  return  loads  for  empty 
cars  is  not  a  reason  for  the  reduction  of  rates  on  such  freight  when  it  does  not 
appear  that  the  rates  are  unreasonable. 

741.  While  the  circumstances  and  conditions  in  respect  to  the  work  done  by 
the  carrier  and  the  revenue  earned  are  dissimilar  in  tlie  transportation  of  freights 
in  car-loads  and  less  than  car-loads,  and  a  lower  rate  on  car-loads  than  onless 
than  car-loads  is,  therefore,  not  in  contravention  of  the  statute,  yet  the  differ- 
ence between  the  two  rates  must  be  reasonable. 

744.  Rates  maintained  and  which  may  be  reasonable  under  the  conditions 
existing  in  one  section  or  part  of  the  country  afford  no  safe  criterion  by  which 


596  ArPENDix. 

to  measure  reasonable  charges  in  other  localities  where  the  expense  of  operating 
a  road  and  other  conditions  affecting  transportation  are  widely  ditferent. 

750.  The  practice  of  making  one  rate  on  the  same  product  over  a  large 
district  is  only  justifiable  under  special  and  exceptional  circumstances,  and  is 
not  to  be  encouraged  when  the  difference  in  the  transportation  expense  from 
the  various  parts  of  such  district  is  considerable  and  substantial. 

751.  That  railroad  investments  may  be  as  secure  as  other  property,  the  rea- 
sonable rates  should  be  liberal  until  earnings  are  sufficiently  large  for  a  fair 
return  on  actual  expenditure. 

752.  Where  the  market  price  yields  but  a  scant  return  for  the  labor  and 
expense  of  production,  the  cost  of  transportation  needs  to  be  as  moderate  as 
may  bo  consistent  with  justice  to  the  carrier. 

758.  A  rate  which  may  be  reasonable  when  applied  to  the  transportation  of 
egg  cases  as  a  disconnected  service  may  be  unreasonable  if  the  carriage  of 
returned  cases  at  favorable  rates  is  in  fact  a  special  service,  the  discontinuance 
of  which  would  unduly  burden  the  business  of  shipping  eggs  to  points  of  sale. 

764.  Each  locality  competing  with  others  in  a  common  market  is  entitled  to 
reasonable  and  just  rates  at  the  hands  of  the  carriers  serving  it,  and  to  the 
benefit  of  all  its  natural  advantages,  and  no  departure  from  the  rule  requiring 
rates  in  all  cases  to  be  reasonable  in  themselves  can  be  justified  on  the  ground 
that  it  is  necessary  in  order  to  maintain  existing  trade  relations,  or  to  "  protect 
competing  markets, "  or  to  "equalize  commercial  conditions,"  or  to  secure  to 
carriers  traffic  from  certain  territory  assumed  to  be  exclusively  theirs. 

773.  Under  the  proviso  to  the  fourth  section  of  the  act  to  regulate  commerce 
it  is  left  to  the  Commission,  in  the  exercise  of  a  reasonable  and  lawful  discretion, 
to  determine  the  description  or  exceptional  character  of  the  "special  cases"  in 
which  the  Commission  may,  after  investigation,  authorize  common  carriers  to 
charge  less  for  longer  than  for  shorter  distances,  and  to  the  extent  to  which 
such  carrier  may  be  relieved  from  the  operation  of  this  section  of  the  act. 

782.  "Where  a  carrier  pays  mileage  for  a  car  which  it  employs  in  the  service 
of  shippers  it  is  the  carrier  and  not  the  party  or  company  from  whom  the  car  is 
rented  who  furnishes  the  car  to  the  shipper,  and  in  such  cases  there  is  no 
privity  of  contract  between  the  car  owner  and  the  shipper. 

783.  It  is  the  duty  of  the  carrier  to  furnish  an  adequate  and  suitable  car 
equipment  for  all  the  business  it  undertakes  and  also  whatever  is  essential  to 
the  safety  and  preservation  of  the  traffic  in  transit. 

784.  When  carriers  undertake  the  transportation  of  perishable  traffic  requir- 
ing refrigeration  in  transit,  ice  and  the  facilities  for  its  transportation  in  connec- 
tion with  that  traffic,  are  incidental  to  the  service  of  transportation,  and  the 
charge  therefore  is  a  charge  "in  connection  with  "  such  service  within  the 
meaning  of  section  1  of  the  act  to  regulate  commerce,  in  respect  to  the  reason- 
ableness of  which  the  carrier  is  subject  to  that  provision  of  the  statute. 

795.  While  carriers  operating  shorter  lines  have  the  advantage,  both  in 
making  rates  and  in  carrying  under  them,  they  can  not  dictate  a  system  of 
charges  which  the  operators  of  longer  lines  may  not  charge  as  to  their  own 
roads,  though  it  may  be  true  as  a  rule,  and  as  claimed  by  defendants,  that,  to 
get  business,  longer  lines  must  take  it  as  low  as  rates  at  the  time  in  force  over 
more  direct  routes. 

821.  Excess  of  manufacturing  cost  to  a  complainant  at  one  point  over  that  of 
its  competitors  in  other  localities,  by  reason  of  inferior  raw  material  and  fuel, 
condition  of  its  plant,  cost  of  labor  or  other  like  causes,  is  not  to  be  considered 
in  ascertaining  the  rightful  relative  adjustment  of  rates  from  such  places,  nor 
does  the  magnitude  of  a  complainant's  enterprise,  the  number  of  persons  for 
whom  it  provides  employment  and  support,  the  developing  results  of  its 
business  upon  the  natural  resources  of  a  state,  the  impracticability  of  moving 
its  plant  to  other  localities,  or  the  fact  that  it  produces  material  largely  used  on 
railroads  for  construction  or  repair,  entitle  such  complainant  to  different  consid- 
eration in  respect  of  just  rates  than  individuals  and  small  concerns  should 
receive ;  but  such  facts  demonstrate  the  far-reaching  extent  to  which  serious 


APPENDIX.  597 

injury  may  be  effected  directly  and  indirectly,  by  methods  and  practices  which 
the  statute  was  designed  to  pi-ohibit. 

825.  The  action  of  a  carrier  in  diverting  through  traffic  from  a  shorter 
route  over  which  it  participates  in  carriage,  so  as  to  requii-e  for  itself  greater 
aggregate  revenue  through  a  long  haul  by  a  different  route  over  which  it  is  also 
engaged  in  transportation,  sometimes  results  in  discriminations  and  prejudices, 
l)oth  as  to  rates  and  facilities;  and  inequality  in  treatment  of  shippers  and 
localities,  having  no  other  justification  than  this  end,  is  indefensible. 

852.  When  rates  are  relatively  unjust,  so  that  undue  preference  is  afforded 
to  one  locality  or  undue  prejudice  results  to  another,  the  law  is  violated  and  its 
penalties  incurred,  although  the  higher  rate  is  not  in  itself  excessive,  and  such 
rule  is  especially  applicable  where  a  given  relation  in  rates,  long  continued  and 
concededly  equitable,  is  suddenly  and  almost  completely  reversed,  merely 
because  other  carriers  to  the  longer  distance  point  have  disregarded  their  legal 
duty. 

860.  A  railway  company  owning  the  entire  stock  of  a  development  com- 
pany, which  had  been  organized  for  the  purpose  of  holding  the  title  to  certain 
lands  of  the  railway  company,  caused  grain  to  be  purchased  in  Kansas  City  in 
the  name  of  the  development  company,  transported  over  the  lines  of  the  rail- 
way company  to  Chicago,  and  there  sold  upon  the  market.  The  development 
companjr  had  no  bona  fide  interest  in  the  transaction.  Neither  the  railway 
company  nor  the  development  company  purchased  the  grain  for  the  purposes  of 
ownership,  the  whole  transaction  being  simply  a  device  to  secure  its  transporta- 
tion at  other  than  the  published  rate;*and  the  only  rate  paid  was  the  profit  upon 
the  transaction,  which  varied  with  each  shipment.  Held,  that  this  constituted 
a  violation  of  the  second,  third,  and  sixth  sections  of  the  act  to  regulate 
commerce. 

867.  Complainant  offered  the  defendant  a  car-load  of  potatoes  at  Verona, 
Miss.,  and  asked  that  the  shipment  be  forwarded  to  Cleveland,  Ohio,  via  a 
connecting  line,  with  which  defendant  had  at  the  time  through  billing 
arrangements  and  through  rates,  but  defendant's  agent  refused  to  receive  and 
route  the  shipment  in  accordance  with  such  direction,  and  complainant  was 
thereby  damaged  to  the  extent  of  $100.  Held,  that  complainant  was  entitled 
to  have  his  merchandise  carried  over  the  route  which  he  directed,  and  that  the 
failure  of  defendant  to  receive  and  forward  the  shipment  accordingly  was  a 
discrimination  against  complainant  in  violation  of  the  act  to  regulate  commerce. 
Separation  ordered. 

878.  Charging  the  same  aggregate  rates  on  like  traffic  for  longer  and 
shorter  distances  over  the  same  line  in  the  same  direction  does  not  contravene 
the  provisions  of  section  4  of  the  act  to  regulate  commerce. 

882.  A  uniform  or  blanket  rate  on  milk,  and  also  on  cream,  from  all  stations 
on  the  defendant  lines  to  "Weehowken,  Hoboken  and  Jersey  City,  N.  J.,  or 
through  Jersey  City  to  New  York,  N.  Y.,  namely,  thirty -two  cents  on  milk 
and  fifty  cents  on  cream  per  can  of  forty  quarts,  regardless  of  distance  or  differ- 
ence in  amount  of  service  rendered.  Held,  to  be  unreasonable,  unjust  and 
unduly  prejudicial  and  in  violation  of  sections  1  and  3  of  the  act  to  regulate 
commerce. 

902.  Water  competition,  to  justify  higher  shorter-distance  charges  under 
the  fourth  section,  must  be  actual  competition  for  the  transportation  Involved, 
and  such  as  to  dictate  the  rate  by  rail.  A  railroad  rute  so  low  as  to  drive  water 
transportation  out  of  existence  cannot  be  justified  by  showing  the  possibility  of 
water  competition;  the  law  permits  railroads  to  meet,  not  to  extinguish,  such 
competition. 

903.  Competition  between  markets,  or  between  carriers  subject  to  the 
regulating  statute,  does  not  create  such  dissimilarity  of  circumstances  and 
conditions  as  will  justify  carriers  in  charging  more  for  the  short  than  for  the 
long  haul,  under  the  fourth  section,  without  an  order  of  the  Commission. 

905.  Railroad  companies  have  the  right  to  earn  a  proper  return  upon  some 
investment,  just  what  has  not  been  very  definitely  determined;  but  in  earning 


598  APPENDIX. 

such  return  they  must  operate  their  properties  in  accordance  with  the  provi- 
sions of  the  statute  forbidding  discrimination  between  localities  and  charging 
more  for  the  short  than  for  the  long  haul. 

928.  The  public  right  to  a  just  relation  of  rates  between  rival  communities 
arises  from  the  statute  which  forbids  discriminating  charges,  and  that  right 
cannot  be  abridged  or  enlarged  by  agreements  of  carriers  with  each  other,  nor 
by  promises  made  to  shippers. 

935.  Although  the  act  to  regulate  commerce  requires  that  transportation 
charges  shall  be  reasonable  and  just,  and  complainant  prayed  in  his  petition 
that  defendants  be  ordered  to  establish  and  maintain  such  rate  on  coal  in  car- 
loads from  Cumberland,  Md.,  to  North  Garden,  Va. ,  as  should  be  deemed  just, 
reasonable,  and  lawful,  the  act  as  recently  interpreted  by  the  courts,  makes 
no  provision  under  which  carriers  can  be  required  or  ordered  to  maintain  any 
rate  other  than  such  rate  of  charges  as  any  such  carrier  may  fix  and  establish 
for  itself. 

941.  Wrongs  caused  by  improperly  adjusted  rates  over  independent  lines 
from  competing  cities  to  a  common  destination  cannot  be  corrected  without 
authority  to  prescribe  both  a  maximum  and  minimum  rate,  and  the  Commission 
is  not  empowered  to  do  either. 

960.  Any  person  or  association  is  entitled  to  complain  before  the  Commis- 
sion of  any  failure  on  the  part  of  carriers  to  publish  and  enforce  transportation 
or  terminal  charges,  rules,  and  regulations,  and  that  such  failure  results  from 
special  privileges  allowed  to  shippers  on  many  important  lines. 

967.  Ptailroad  companies  are  not  prohibited  by  section  3  of  the  act  from 
preferring  one  locality  over  another,  unless  the  preference  is  undue  or  unreason- 
able, but  a  preference  which  is  without  legitimate  excuse,  is,  in  and  of  itself, 
unreasonable. 

969.  Carriers  frequently  disregard  distance  in  making  their  rates,  and  they 
may  lawfully  do  so  under  some  circumstances;  but  distance  should  be  regarded 
wherever  possible,  and  no  previous  decision  is  authority  for  a  ruling  that  a 
carrier  may  be  compelled  to  disregard  it  for  the  purpose  of  placing  two  com- 
munities upon  a  commercial  equality. 

980.  The  exaction  of  as  high  rates  for  a  shorter  haul  as  for  a  longer  haul 
over  the  same  line  in  the  same  direction,  the  shorter  haul  being  included  within 
the  longer,  is  itself  a  discrimination,  and,  if  not  justified  by  a  substantial  dis- 
similarity of  circumstances  and  conditions,  is  an  unjust  discrimination. 

981.  In  respect  to  competition  as  justifying  discrimination,  the  Supreme 
Court  of  the  United  States  has  only  gone  to  the  extent  of  holding  that  it  "  may 
in  some  cases  "  be  such  as  "  having  due  regard  to  the  interests  of  the  public 
and  of  the  carrier,  ought,  justly,  to'have  effect  upon  rates,"  and  that  the  mere 
fact  of  competition,  no  matter  what  its  character  or  extent,"  does  not  neces- 
sarily relieve  carriers  from  the  restraints  of  the  third  and  fourth  sections  of 
the  act  to  regulate  commerce. 

982.  The  Supreme  Court  of  the  United  States,  while  denying  power  in  the 
Interstate  Commerce  Commission  to  enforce  the  provision  of  section  1  of  the 
act  to  regulate  commerce,  namely,  that  all  charges  shall  be  reasonable  and 
just — by  orders  prescribing  reasonable  maximum  rates,  expressly  recognizes  the 
authority  and  duty  of  the  Commission  to  enforce  sections  2,  3,  and  4  of  the  act. 

2.     EXTRACTS  FROM  THE  REPORT  OF   THE  INTERSTATE  COM 
MERCE  COMMISSION  FOR  189S. 

After  stating  that  the  Commission,  in  former  reports,  has  called  the  atten- 
tion of  Congress  to  the  vital  defects  of  the  act  to  regulate  commerce,  and  has 
thereby  performed  its  full  duty,  the  report  goes  on  to  say  : — 

"  Meanwhile  the  situation  has  become  intolerable,  both  from  the  standpoint 
of  the  public  and  the  carriers.      Tariffs  are  disregarded,  discriminations  con- 


APPENDIX.  599 

stantly  occur,  the  price  at  which  transportutiou  can  be  had  is  fluctuating  and 
uncertain.  Railroad  managers  are  distrustful  of  each  other  and  shippers  all 
the  while  in  doubt  as  to  the  rates  secured  by  their  competitors.  Enormous 
sums  are  spent  in  purchasing  business,  and  secret  rates  accorded  far  below  the 
standard  of  published  charges.  The  general  public  gets  little  benefit  from 
these  reductions,  for  concessions  are  mainly  confined  to  the  heavier  shippers. 
All  this  augments  the  advantages  of  large  capital  and  tends  to  the  injury  and 
often  to  the  ruin  of  smaller  dealers." 

In  discussing  attempts  of  the  Commission  to  extort  the  truth  as  to  these 
practices  from  railroad  officials,  the  following  expressions  are  used  by  the 
Commission : — 

"  The  inquiry  was  greatly  hampered  by  the  disappearance  of  material  wit- 
nesses;" and  the  "inability  of  several  who  did  testify  to  recall  transactions  of 
then  recent  date."  "All  of  the  railway  witnesses  denied  knowledge  of  any 
violation  of  the  statute,"  but  "it  was  nevertheless  established  that  secret  rate 
concessions  had  been  generally  granted  on  this  traffic,  and  that  the  carriers  had 
allowed  larger  rebates  to  some  of  the  flour  shippers  than  to  others." 

Several  pages  of  the  Report  of  1898  are  devoted  to  matter  of  this  kind 
affecting  many  railroads,  and  some  of  the  methods  adopted  to  violate  the  act 
without  detection  are  exposed.  It  is  evident  that  the  Commission  believes  that 
the  entire  railroad  system  of  the  country  is  permeated  by  frauds,  by  means  of 
which  the  rich  oppress  the  poor,  but  which  the  Commission  is  without  power  to 
remedy. 

The  farmers  will  do  well  to  see  that  the  Commission  is  clothed  with  the 
power,  or  that  their  congressmen  tell  them  the  reason  why  not. 

3.     STATISTICS   OF  RAILWAYS  IN   THE    UNITED  STATES. 

FROM     THE      REPORT     OF     THE     U.      S.      INTERSTATE      COMMERCE      COMMISSION 
FOR     1898. 

Total  railway  mileage,  June  30,  1897 184,428 

Increase  over  previous  year 1,651 

Total  mileage,  including  side  tracks  and  double  tracks  243,444 

Increase  over  previous  year 3,31d 

No.  railway  corporations. 1,987 

No.  actually  operating  roads 1,037 

No.  roads  in  hands  of  recievers 128 

Mileage  operated  by  same 18,861 

Decrease  from  previous  year 11,613 

Total  No.  of  locomotives  in  service 35,986 

Total  No.  of  cars 1,297,480 

Total  number  of  men  employed 823,476 

No.  of  men  to  each  100  miles  of  line 449 

The  employees  were  distributed  as  follows : — 

Administration  (doubtless  including  solicitors).     .    ,    .  31,871 

Maintenance  of  way  and  structure 244,873 

Maintenance  of  equipment 160,667 

Conducting  transportation 378,361 

Unclassified 7,704 

Amount  paid  in  wages  and  salaries $      465,601,581 

Decrease  from  previous  year 3,222,950 

Total  nominal  capital 10,635,008,074 

Nominal  capital  per  mile 59,620 


600  APPENDIX. 

The  capital  was  divided  as  follows: — 

Stock $5,364,642,255 

Bonds 6,270,365,819 

Stock  paying  no  dividends 3,761,092,277 

Bonds  paying  no  interest. 867,950,840 

Total  dividends  paid  on  stock. 87,110,599 

Average  dividend  paid  by  dividend  paying  stocks  .    .  5.43  per  cent 

Current  (unfunded)  liabilities $    578,501,635 

Interest  paid  on  funded  debt 247,880,230 

No.  passengers  carried 489,445,198 

No.  passengers  carried  one  mile 12,256,939,647 

Tons  freight  carried 741,705,946 

Tons  freight  carried  one  mile 95,139,022,225 

Gross  earnings $1,122,089,773 

f         251  135  927 
Earnings  from  passenger  service <  fi'fi9q'q8n 

Earnings  from  freight  service 4  '  4'209'657 

Earnings  from  express 24,901,066 

Earnings  from  mail 33,754,466 

Other  earnings 28.609,363 

Total  operating  expenses 752,524,764 

Divided  as  follows: — 

Maintenance  of  way  and  structures |159, 434,403 

Maintenance  of  equipment 122,762,358 

Conducting  transportation 432,525,862 

General  operating  expenses 36,481,269 

Administration 508,598 

Interest  on  funded  debt 247,880,230 

Taxes 43,137,844 

Permanent  improvements 4,544,813 

Other  general  expenses 21,97'6,390 

The  sums  disbursed  for  interest  on  funded  debt  and  for  dividends  represent 
the  net  income  of  the  roads.     These  were: — 

Dividends  on  stock $  87,110,599 

Interest  on  bonds 247,880,230 

Total  income  divided $334,990,829 

This  sum  paid  in  dividends  or  interest  represents: — 

At  6%  a  capital  of. $5,575,160,482 

At  5%  "       " 6,699,816,580 

At  4%  "       " 8,374,770,725 

These  sums  may  therefore  be  taken  as  the  actual  current  value  of  the  rail- 
roads of  the  United  States,  regardless  of  their  prospects  for  the  future,  the 
larger  or  the  smaller  sum  being  taken,  according  as  one  may  believe,  four,  five, 
or  six  per  cent  to  be  the  proper  rate  of  interest.  In  this  case,  also,  the  net 
income  is  spread  over  the  whole  mileage,  although  some  roads  were  operated  at 
a  loss.  If  we  deduct  from  the  total  capitalization  of  the  roads  (stock  and 
bonds)  the  amount  of  stock  which  paid  no  dividends,  and  is,  to  a  great  extent, 
doubtless,  mostly  "  water,"  there  remains  the  sum  of  $6,873,915,797,  which  is 


APPENDIX.  601 

very  nearly  the  sum  upon  ■which  five  per  cent  interest  was  paid  in  1897. 
Upon  the  average,  therefore,  railroad  investments  in  America  pay  very  \jell 
indeed,  all  this  being  free  of  taxes,  or,  at  least,  mostly  free,  and  very  much 
better  than  investments  in  farms.  The  wish  of  the  railroad  owners  is  to  make 
the  roads  pay  as  good  interest  as  possible  upon  their  entii'e  paper  capitalization. 
It  is  the  wish  of  the  farmers  and  others  that  this  should  not  happen,  but  that 
increasing  business  should  be  accompanied  by  such  diminution  of  rates  as  will 
keep  down  revenue  so  that  it  no  more  than  pays  fair  interest  on  actual  and 
honest  investment,  reserving  the  "unearned  increment"  to  the  people.  The 
railroad  owners  claim  that  they  are  entitled  to  the  unearned  increment  because 
they  took  the  risk  of  construction,  and  in  many  cases  have  lost  money.  That 
is  one  phase  of  the  "  railroad  question," 


Appendix  F 


COOPERATIOlSr. 


7.     COOPERATION  AMONG   FARMERS. 

There  are  few  statistics  of  cooperation  among  farmers  in  the  United  States 
for  business  purposes.  There  is  probably  much  more  of  it  than  we  know  any- 
thing about.  As  is  inevitable  in  the  beginning  of  the  practice,  large  numbers 
of  societies  are  started  without  adequate  foundation  and  amount  to  nothing. 
Still  others  start  off  well,  but  develop  no  staying  qualities,  and  soon  pass  away. 
In  many  cases  societies— especially  cooperative  creameries- are  started  by  those 
who  do  not  develop  the  business  capacity  to  make  them  profitable,  and  so  pass 
into  the  hands  of  better  business  men,  as  private  concerns,  while  still  retaining 
the  cooperative  title. 

The  purposes  for  which  cooperative  societies  of  farmers  have  been  formed  in 
this  country,  are,  in  the  probable  order  of  their  relative  importance,  creameries, 
irrigating  ditch  companies,  fire  insurance  companies,  marketing  societies, 
general  stores,  and  flouring  mills.  Our  decennial  census  reports  ought  to  show 
the  facts  as  to  the  progress  of  cooperative  work,  but  thus  far  have  not  done  so. 
I  understand  that  there  is  a  probability  that  some  inquiry  will  be  made  as  to 
these  facts  in  the  census  of  1900.  I  am  not  able  to  find  data  from  which  to 
form  any  estimate  of  the  present  status  of  cooperation  in  the  United  States, 
and  therefore  do  not  attempt  it. 

I  gathered,  in  1898,  for  the  United  States  Department  of  Agriculture,  as 
good  a  list  as  was  possible  by  correspondence,  of  the  farmers'  cooperative 
societies  of  California.  It  included  seventy-three  irrigating  ditch  companies 
(certainly  incomplete),  three  flouring  mills,  and  two  fire  insurance  companies. 
It  was  impossible  to  obtain  by  correspondence  a  list  of  the  cooperative  cream- 
eries. Some  of  the  granges  and  farmers'  clubs  do  more  or  less  purchasing  for 
their  members.  There  were  once  a  good  many  cooperative  stores,  but  none 
were  ever  managed  on  the  Eoclulale  plan,  and  while  some  are  still  in  existence 
and  retain  the  cooperative  title,  if  any  remain  really  cooperative  I  do  not 
know   it. 

The  following  is  a  list,  very  nearly  correct,  of  the  cooperative  fruit  market- 
ing societies  of  California  which   actually   did  business  in   1898,   or  are  so 
organized  as  to  give  reasonable  assurance  of  permanence.     Quite  a  number  of 
new  ones  are  in  process  of  organization;  tlu'  sales  of  these  societies,  in  1898- 
( G02  ) 


APPENDIX.  G03 

1899  aggregated  over  $5,000,000,  with  a  membership  of  something  lesf;  than 
seven  thousand.  An  estimate  of  the  average  capital  of  the  members  at  $3,000 
each  would  give  a  total  product  capital  of  $21,000,000. 

Citrtis  Fruit  Societies  Selling  through  the  Southern  California  Fruit  Exchanges, 
122   West  Third  Street,  Los  Angeles. 

Duarte-Monrovia  Fruit  Exchange,  Duarte. 

San  Antonio  Fruit  Exchange,  Pomona. 

Semi-Tropic  Fruit  Exchange,.  Los  Angeles. 

Azusa-Covina-Glendora  Fruit  Exchange,  Azusa. 

Riverside  Fruit  Exchange,  Riverside, 

San  Bernardino  Fruit  Exchange,  Colton. 

Orange  County  Fruit  Exchange,  Orange. 

Queen  Colony  Fruit  Exchange,  Corona. 

Ontario-Cucamonga  Fruit  Exchange,  North  Ontario. 

Santa  Barbara  Lemon-Growers'  Exchange,  Santa  Barbara. 

San  Diego  County  Fruit  Exchange,  Chula  Vista. 

Chula  Vista  Fruit  Exchange,  Chula  Vista. 

Fallbrook  Fruit  Association,  Fallbrook. 

Fillmore  Citrus  Association,  Fillmore. 

El  Cajon  Fruit  Exchange  El  Cajon. 

Independent  Citrus  Exchanges. 

Redlands  Orange-Growers'  Association,  Redhinds. 

Redlands  Fruit  Association. 

Highland  Orange-Growers'  Association,  Messina. 

East  Highland  Orange-Growers'  Association,  East  Highland. 

Golden  Belt  Fruit  Company,  FuUerton. 

Placentia  Fruit  Exchange  (?),  Fullerton. 

Dried  Fruit  Marketing  Societies. 

Santa  Clara  County  Fruit  Exchange,  San  Jose. 

"West  Side  Fruit-Growers'  Union,  Santa  Clara. 

East  Side  Fruit-Growers'  Union,  San  Jose. 

Berryessa  Fruit-Growers'  Union,  Berryessa. 

Campbell  Fruit  Union,  Campbell. 

Willow  Glen  Fruit  Union,  Willow  Glen. 

Woodland  Fruit  Exchange,  Woodland. 

Niles  Cooperative  Fruit  Association,  Niles. 

Pajaro  Valley  Fruit  Exchange,  Watsonville.     (Handles  fresh  fruit  also.) 

Napa  Fruit  Company,  Napa. 

Visalia  Fruit-Growers'  Union,  Visalia. 

The  Following  Dried  Fruit  Associations  are  aJfiHatcd  with,  and.  Sell  through, 
the  Southern  California  Deciduous  Fruit  Exchanges,  122  West  Third  Street, 
Los  Angeles. 

Pasadena  Fruit  Exchange  (three  associations),  Pasadena. 


G04  APPENDIX. 

Burbank  Fruit  Association,  Burbank. 

Manzana  Fruit  Association. 

San  Gabriel  Fruit  Association,  San  Gabriel. 

Duarte  Fruit  Association,  Duarte. 

North  Pomona  Fruit  Association,  North  Pomona. 

San  Jacinto  Fruit  Association,  San  Jacinto. 

Perris  Fruit  Association,  Perris. 

Anaheim  Fruit  Association,  Anaheim. 

Filhnore  Fruit  Association,,  FiUmore. 

Cucamonga  Fruit  Association,  Cucamonga. 

Fallbrook  Fruit  Association,  Fallbrook, 

(The  societies  selling  through  the  Southern  California  Deciduous  Fruit 
Exchanges  were  all  organized  in  1898.  Owing  to  the  drought  of  that  year 
some  of  them  had  no  fruit  to  sell,  and  have,  therefore,  never  yet  actually 
transacted  business.  At  the  present  time  other  organizations  are  forming,  and 
the  central  organization  also  handles  the  fruit  of  some  individual  growers.) 

Walnut  Market'mg  Associations. 

Los  Nietos  and  Kanchita  Walnut-Growers'  Association,  Rivera. 

Mountain  View  "Walnut-Growers'  Association,  El  Monte. 

Santa  Ana  Yalley  Walnut-Growers'  Association,  Santa  Ana. 

Saticoy  Walnut-Growers'  Association,  Santa  Paula. 

Santa  Barbara  Walnut-Growers'  Association,  Santa  Barbara. 

FuUerton  Walnut-Growers'  Association,  Fullerton. 

Golden  Belt  Fruit  Company,  Fullerton. 

(The  Golden  Belt  Company,  and  possibly  others,  also  handle  citrus  fruits. 
The  walnut-growers'  associations  annually  meet  and  agree  upon  a  common 
scale  of  prices,  to  which  all  adhere.  The  associations  control  the  walnut 
market,  subject  to  the  competition  of  imported  walnuts.) 

Raisins. 

California  Raisin-Growers'  Association,  Fresno. 

Wine. 

California  Wine-Makers'  Corporation,  Crocker  Building,  San  Francisco. 

Fresh  Fruits. 

Contra  Costa  Fruit-Growers'  Union,  Martinez. 
Florin  Fruit-Growers'  Association,  Florin. 

Honey. 

California  Beekeepers'  Exchange,  Lang. 

The  most  important  cooperative  societies  of  farmers  outside  the  United 
States  are  the  "  Agricultural  Syndicates  "  of  France.  These,  in  the  main,  are 
societies  for  the  purchase  of  supplies,  especially  fertilizers,  and  of  farm 
machinery  for  rental  to  the  members.  Some  of  them  also  do  more  or  less 
marketing.     The  aggregate  membership  of  these  societies  is  very  large,  but  I 


APPENDIX. 


605 


have  not  been  able  to 'find  late  statistical  information  in  regard  to  them  or  in 
regard  to  the  "  peoples' banks,"  which  are  established  in  many  countries  of 
Continental  Europe,  and  in  many  cases  almost  exclusively  for  the  benefit  of 
farmers.  Cooperative  creameries  seem  to  succeed  better  in  Denmark  than  any- 
where else,  and  there  are  some  in  Ireland.  In  England  there  is  little  or  no  co- 
operation among  farmers,  as  we  usually  think  of  them  in  the  United  States,  but 
there  is  more  or  less  systematic  efturt  to  promote  organization  of  small  societies 
of  farm  laborers  for  the  rental  or  purchase  of  land  to  be  farmed  cooperatively. 
This  is  favored  by  some  of  the  cooperative  stores  as  a  means  of  employment 
of  their  surplus  capital,  to  be  used  in  this  manner  in  aid  of  the  farm  laborers. 
Quite  a  number  of  such  societies  have  been  formed,  but  thus  far  have  usually 
been  unsuccessful,  except  when  the  cooperative  store  supplying  the  capital 
afforded  a  home  market  for  the  product  of  the  farm.  The  British  cooperators, 
however,  expect  to  solve  the  problem  of  cooperation  among  farmers  for 
productive  purposes.  ' 

//.     COOPERATION  AMONG  OTHERS  THAN  FARMERS. 

Whatever  the  form  which  the  struggle  for  existence  may- take  with  indi- 
viduals, they  invariably  turn,  whenever  it  becomes  severe,  to  the  idea  of 
cooperation.  It  is  an  instinct  pervading  all  nature,  whose  exercise  is  recognized 
by  social  philosophers  as  the  panacea  for  all  curable  ills  of  society.  We  are 
not  all  philosophers,  however,  and  sometimes  our  views  of  cooperation,  being 
confined  to  the  bounds  of  our  immediate  necessities,  are  very  narrow.  The 
ant's  conception  of  cooperation  may  be  simply  of  help  enough  to  carry  off  a 
dead  beetle.  The  Californian  farmer  thinks  of  cooperation  as  a  device  to 
enable  him  to  get  higher  prices  for  his  wheat  at  Liverpool.  The  British  farmer 
thinks  of  it  as  a  means  for  preventing  his  Californian  competitor  from  selling 
in  Liverpool  at  all,  while  the  British  artisan  thinks  of  it  as  a  means  of  getting 
cheap  bread.  I  am  unable  to  see  any  difference  between  the  principle  which 
leads  Tim  and  Mike  to  join,  under  the  persuasion  of  a  benevolent  society,  in  a 
cooperative  dairy  in  Ireland,  and  that  which  moves  Smith  and  Jones,  under 
the  persuasion  of  a  shrewd  promoter,  to  join  in  buying  Mr.  Carnegie's  steel 
plants  for  six  hundred  millions  of  dollars.  Of  course  there  is  a  great  difference 
between  the  motives  which  inspire  the  society  in  the  one  case,  and  the  pro- 
moters in  the  other,  but  as  for  Tim  and  Mike  and  Smith  and  Jones  they  all 
alike  wish  to  increase  their  incomes.  Of  course,  also,  my  own  feelings  towards 
the  two  enterprises  are  very  dillerent.  I  earnestly  desire  that  Tim  and  Mike 
may  succeed,  because  they  are  not  now  receiving  proper  reward  for  their  own 
hard  labor,  while  I  shall  be  quite  content  to  see  Smith  and  Jones  lose  their 
money  because  they  are  seeking,  by  cooperation,  to  obtain  what  other  people 
must  work  to  pay  for.  And  I  wish  Tim  and  Mike  well  none  the  less  because 
I  know  that  if  ever  they  find  themselves  strong  enough  they  will  ruthlessly 
make  me  pay  $10  a  pound  for  my  butter  or  go  without  it.  As  I  think,  hO 
thinks  society,  which  almost  unanimously  favors  the  association  of  the  weak, 
while  opposing  that  of  those  who  are  already  strong.  The  one  it  calls  ' '  coopera- 
tion "  while  the  other  is  termed  a  "combine."  It  seems  to  me  that  this 
instinctive  feeling  in  all  of  us  is  an  expression  of  sound,  logical  common  sense, 


606  APPENDIX. 

We  must  encourage  the  cooperation  of  those  whose  sacritices  do  not  procure  for 
them  just  satisfactions,  while  vigorously  restraining  that  of  those  who  are 
getting  what  they  do  not  earn.  I  recognize  that  the  object  of  the  farmers' 
Raisin  Trust  of  California  is  to  compel  me  to  pay  the  highest  possible  prices  for 
my  raisins,  just  as  that  of  the  Sugar  Trust  is  to  compel  me  to  pay  the  highest 
possible  prices  for  my  sugar,  and  yet  I  would  support  the  one  and  subdue  the 
other,  because  the  one,  at  present,  seeks  justice,  and  the  other  injustice.  When- 
ever the  Farmers'  Trust  attempts  to  do  injustice,  as  it  will  if  it  ever  has  the 
power,  I  would  subdue  that  also.  I  think  it  very  desirable  that  farmers  come 
to  take  this  broad  view  of  cooperation,  and  hence  include  in  this  appendix  a 
few  facts  regarding  cooperation  by  others  than  farmers. 

In  regard  to  the  general  statistics  of  cooperation  in  the  United  States,  it 
must  be  said  that  there  is  the  same  lack  of  information  that  exists  in  regard  to 
cooperation  among  farmers.  One  cause  of  this  is  the  lack  of  proper  legislation. 
One  of  the  first  things  .to  be  done  in  this  country  in  the  cause  of  cooperation 
is  the  drafting  of  a  proper  law  for  the  regulation  of  cooperative  societies  and 
their  registration  under  it.  Such  a  law  would  provide  for  compliance  with 
certain  conditions  ■  essential  to  security  and  stability,  define  the  rights  and 
obligations  of  membership,  and  provide  for  registration  and  regular  annual 
reports.  This  is  done  in  older  countries,  and  is  necessary  here.  Such  a  law, 
when  drafted,  could  be  passed  without  dilficulty,  by  a  little  organized  eflTort 
in  all  the  states.  In  California,  and  probably  in  some  other  states,  no 
proper  law  could  be  passed,  except  after  a  constitutional  amendment.  In 
Appendix  D  will  be  found  references  to  a  few  books  giving  such  information 
as  there  seems  to  be  about  cooperation  in  this  country.  I  sought  to  obtain  later 
information,  but  could  get  little  or  none.  The  following  letter  from  Mr.  N.  O. 
Nelson,  of  St.  Louis,  which  is  all  of  value  which  I  have  been  able  to  get,  is 
given  in  full  because  of  its  general  interest,  although  not  intended  for  publica- 
tion, and  referring  to  various  matters  not  closely  connected  : — 

St.  Louis,  Mo.,  March  22,  1899. 
Dear  Mr.  Adams  : — Cohn  &  Co.,  musical  instrument  makers,  Elkhart, 
Ind.;  Proctor  &  Gamble,  soap  makers,  Cincinnati,  Ohio;  Spencer,  Trask  &  Co., 
bankers,  New  York,  are  the  only  profit-sharing  concerns  of  consequence  that 
now  occur  to  me  in  this  country.  [Mr.  Nelson  should  have  included  his  own— 
The  N.  O.  Nelson  Mfg.  Co.,  Leclaire,  111.,  e.  f.  a.]  The  system  keeps 
growing  in  France,  and  still  more  so  in  England,  where  an  active  propaganda 
IS  carried  on  by  an  association.  The  plan  was  adopted  by  a  considerable  num- 
ber of  concerns  in  this  country  in  the  later  eighties,  but  was  abandoned  by  most 
of  them  in  the  course  of  a  year  or  two.  there  are,  no  doubt,  a  great  many 
scattered  over  the  country,  which  have  been  given  no  publicity.  There  was  an 
association  formed  in  1892  under  the  leadership  of  N.  P.  Oilman,  author  of 
"  Profit-Sharing  between  Employer  and  Employees,"  but  it  was  abandoned  for 
lack  of  sufficient  support.  Fifteen  hundred  dollars  is  the  largest  salary  paid  to 
P]nglish  cooperative  managers.  Mr.  Fawcett,  who  has  long  been  the  head  of 
the  great  Leeds  Society,  with  its  33,000  members  and  annual  business  of  about 
five  million  dollars,  gets  this  amount.  He  is  of  a  caliber  to  easily  command 
ten  thousand  in  private  employment.  J.  T.  W.  Mitchell  was  chairman  of  the 
English  Wholesale  for  twenty-one  years,  building  it  up  from  one  million  to  fifty 
millions  a  year.  He  never  took  beyond  one  thousand  a  year,  and  out  of  this 
he  bfjre  some  incidentals  connected  with  lecturing  trips  and  attendance  on 
meetings,  where  his  expense  account  was  overlooked.     He  was  a  man  of  so 


APPENDIX.  C07 

much  all-around  ability  that  just  before  his  death  ho  was  elected  a  trustee  of  the 
great  Manchester  Ship  Canal,  which,  however,  he  declined.  Salaries  in  large 
concerns  are  quite  as  liberal  in  England  as  in  this  country.  He  could,  no 
doubt,  have  obtained  twenty-five  thousand  a  year,  had  he  been  willing  to 
resign' his  more  attractive  work  and  dutiful  life  at  the  head  of  the  cooperative 
business.  ,       .    ,.  t 

In  this  country,  the  chief  cooperative  stores  arc  the  Arlington,  at  Lawrence, 
Mass.,  with  thirty -five  hundred  members,  three  hundred  thousand  dollars  sales, 
seven  and  one-half  per  cent  regular  dividends  on  purchases,  besides  the  interest 
on  capital,  and  liberal  additions  to  the  surplus  fund  ;  the  Johnson  County 
Cooperative  Association  at  Olathe,  Kansas,  which  is  confined  to  Patrons  of 
Husbandry,  but  sells  to  the  general  public.  It  is  twenty-two  years  old,  has  a 
business  of  two  hundred  and  fifty  thousand  dollars  a  year,  has  two  branches,  and 
from  it  have  sprung  the  leading  bank  of  the  town  and  a  good  insurance  com- 
pany. I  have  been^at  both  of  these  places  and  found  them  unusually  vigorous 
and  progressive.  There  are  well-established  and  important  stores  at  Lyons, 
Iowa,  Trenton,  N.  J.,  and  Galveston,  Texas.  There  are  a  great  many  smaller 
and  younger  ones  in  the  East  and  in  the  Mississippi  Valley.  The  West  is  full  of 
cooperative  creameries,  small  flour  mills  and  canneries.  Of  cooperative  colonies, 
the  ones  at  Kuskin,  Tenn.,  Commonwealth,  Ga.,  and  Belfast,  "Wash.,  are  the 
more  important.  They  are  doing  tolerably  well.  I  have  visited  the  former 
two  at  different  times.  I  have  concluded  that  there  is  not  much  outcome 
to  the  colonies  when  not  inspired  by  anything  but  economic  motives.  I 
exceedingly  regret  that  I  can  give  j'ou  so  very  little  information,  but,  as  you 
say,  it  is  hardier  to  get  at  in  this  country  than  in  foreign  lands.  Yours  very 
truly,  N.  0.  Nelson. 

In  Great  Britain  cooperation  has  developed  mainly  on  the  lines  of  mer- 
chandising and  production.  It  has  had  a  normal,  although  surprising  develop- 
ment. Beginning  with  a  capital  of  a  few  pounds,  contributed  by  workmen, 
in  sums  of  a  few  shillings  each,  for  the  establishment  of  a  retail  store,  the 
movement  has  grown  to  the  proportions  about  to  be  described.  The  faithful- 
ness of  the  Kochdale  pioneers  assured  success  for  their  enterprise,  and  their 
success  led  to  the  establishment  of  similar  stores  elsewhere.  The  opposition  of 
private  traders  in  some  cases  prevented  the  cooperative  stores  from  obtaining 
supplies  from  wholesale  merchants,  and  this  led  to  the  establishment  of  the 
great  English  and  Scottish  wholesale  stores.  The  capital  of  these  great  societies 
is  mainly  contributed  by  the  retail  stores,  to  which,  only,  the  wholesale  societies 
sell.  As  trade  has  increased,  the  wholesale  societies  have  engaged  in  the  manu- 
facture of  some  of  the  merchandise  most  in  demand.  They  have  branch  estab- 
lishments for  buying  in  all  countries  in  whose  produce  they  deal,  and  own  a 
fleet  of  several  steamers.  Being  constantly  charged  with  the  custody  of  the 
surplus  funds  of  the  societies,  they  were  led  to  open  banking  departments. 
They  bid  fair  to,  in  the  end,  cover  the  entire  field  of  manufacturing  articles 
most  in  demand  by  the  retail  trade. 

The  greater  part  of  the  capital  of  the  cooperative  societies  of  Great  Britain 
has  been  derived  from  the  profits  of  the  business.  Goods  are  invariably  sold  at 
the  retail  prices  charged  by  private  firms.  The  profits  go,  first,  to  the  payment 
of  a  small  dividend  on  the  share  capital,  next  to  the  creation  of  a  surplus  fund, 
as  security  against  losses,  and  the  remainder  as  rebates  to  purchasers.  In  some 
cases  the  salesmen  and  other  employees,  als  such,  receive  a  portion  of  the  profits, 
and  in  other  cases  they  do  not.  In  most  cases  regular  provision  is  made  from 
the  profits  for  carrying  on  educational  work,  and  many  of  the  more  prosperous 


608 


APPENDIX. 


societies  own  halls,  which  are  used  for  such  purposes.  Purchases  and  sales  are 
made  for  cash  only,  thus  inculcating  a  spirit  of  thrift.  The  educational  work 
is  yearly  becoming  more  prominent,  and  cooperation  among  all  classes  is  pro- 
moted in  the  true  missionary  spirit.  The  cooperative  movement  in  Gi-eat 
Britain  has  developed  a  body  of  wonderful  men,  practically  all  of  whom  are 
individually  poor,  and  yet  carrying  on  with  great  ability,  and  constantly 
extending  business  enterprises  involving  the  wise  employment  of  great  sums  of 
money,  and  the  organization  and  direction  of  a  great  force  of  employees.  The 
English  Wholesale  Society  is  the  largest  strictly  mercantile  business  in  the 
world.  There  is  only  space  here  for  a  very  brief  statistical  summary,  con- 
densed from  the  report  of  the  Thirtieth  Annual  Cooperative  Congress  of  Great 
Britain  (1898),  which  is  a  volume  of  286  large  quarto  pages.  The  pounds 
sterling  may  be  roughly  turned  into  United  States  money  by  multiplying  by 
five. 

///.    DISTRIBUTIVE  {RETAIL)  SOCIETIES. 

THE   POSITION    OF    COOPERATION    IN    GREAT    BRITAIN,    1898. 


1.   General  Statistics. 


Number  of  societies 

1896. 
.    .    .           1,741  .   . 

1897. 
,   .   .           1,845 

Number  of  societies  to  which  the 
relate          .                     ... 

figures 

.    .               1,665  .    . 

.    .    .            1,686 

Number  of  members 

.    1,492,371 

.    .    .    1,591,455 

Shares 

£ 
.    .    .  17,546,924  .    . 

£ 
.    .    .  18,611,658 

Sales 

57.318.426  .    . 

.    .    .  62.287.058 

Profits 6,337,490 6,717,876 

Investments 10,632,346 10,817,251 

These  figures  are  made  up  in  the  following  manner; — 

Shares.         Sales.         Profits. 
Societies.       Members.        £                 £                £ 
Wholesale  societies.    .    .1896          2          1,327        870,524  14,937,638      383,264 
1897          2          1,334        940,237  16,325,464      346,040 

Ketail  societies 1896  1,453  1,378,036  15,367,319  36.942,030  5,724,535 

"                   1897  1,469  1,465,564  16,318,760  40,125,359  6,140,821 

♦Productive  societies  ..  1896      259        38,637        771,806     2,625,947      156,592 

1897      339        42,051        808,465     2,999,687      166,329 

Supply  associations.    .    .1896        17        74,039        536,160     2,700,009        73,067 

1897        19        81,251        541,673     2,723,150        64,465 

Special  societies  ....  1896        10             332            1,115        112,802               32 

1897        16          1,255            2,523        113,398             221 

The  following  table  will  show  the  advance  made  by  distributive  cooperation 
in  recent  years: — 


Societies. 

Members. 

Shares. 

Sales. 

Profits. 

1887 
\              1897 

1,348 
1,469 

858,237 
1,465,564 

8,461,888 
16,318,760 

£ 
22,.S43,651 
40,125,359 

£ 

2,940,337 
6,140,821 

Under  this  head  are  included  the  numerous  Irish  Agricultural  and  Dairy  Societies, 


APPENDIX. 

Productive  Societies. 


609 


tScottish  Wholesale,  1896. 


Number 

of 
Societies 


England  and  Wales,  1896. 
1897. 

Scotland,  1896 

1897 

Ireland,  1896 

1897 

♦English  Wholesale,  1896.  . 


261 
274 


Number 
of  Em- 
ploy <5s. 


5,932 
6,012 
1,378 
1,529 
165 
181 
5,634 
6,809 
3,403 
3,927 


Capital 

Em- 
ployed. 


39,187 
639,137 
695,147 
351,303 
366,173 


Trade 
during 
Year. 


£ 

1,961,896 

2,211,904 

411,125 

475,987 

252,927 

276,496 

1,149,390 

1,385,085 

720,743 

1,108,934 


16,512      2,181,944     4,496,081     228,193     4,855 
18,458      2,324,445     5,458,406     256,044    11,052 


£ 
103,715 
106,036 
48,272 
55,362 
4,602 
4,540 
35,666 
34,421 

55^685 


97 

952 

3,716 

5,192 

653 


♦Twelve  productive  departments. 


fEleven  productive  departments. 


In  Continental  Europe  the  greatest  development  of  cooperation  has  been  in 
the  direction  of  credit  and  loan  associations — "People's  Banks,"  These  had 
their  origin  in  Germany,  but  have  spread  all  over  continential  Europe.  There 
are  two  forms  of  these  banks,  known  from  the  names  of  their  originators,  as  the 
Schulze-Delitzsch  and  the  Raiffeisen  banks.  The  latter  are  the  more  altrustic 
in  spirit  and  the  most  widely  extended.  The  main  principle  of  nearly  all  these 
banks  is  the  unlimited  liability  of  every  member  of  an  association  for  all  debts 
of  the  association.  With  this  security  the  banks  are  enabled  to  borrow  money 
very  cheaply,  to  be  loaned  to  their  members,  with  only  sufficient  profit  to  pay 
expenses  upon  the  most  economical  scale.  There  are  also,  of  course,  the  pro- 
ceeds of  the  stock  taken  up  by  the  members,  and  the  deposits.  I  do  not  find, 
where  I  write,  any  late  statistics  of  the  business  done  by  these  banks,  but  in 
the  aggregate  they  amount  to  hundreds  of  millions  of  dollars  annually,  and 
form  altogether  the  most  imposing  display  of  the  power  of  cooperation  in  busi- 
ness affairs. 

Other  forms  of  cooperation  are  the  trade  unions  and  other  friendly  societies 
in  the  matter  of  life  and  health  insurance,  fire  insurance  societies,  building  and 
loan  societies,  and  profit  sharing.  Taken  together,  the  amount  of  cooperative 
business  done  in  the  world  is  astounding  to  those  who  first  come  to  the  study  of 
it.  It  has  been  demonstrated  many  times  over  that  the  aggregate  savings  of  the 
poor  are  far  in  excess  of  the  aggregate  capital  of  the  rich,  and  that  there  is 
quite  as  much  capacity  for  the  wise  employment  of  capital,  and  its  profitable 
direction,  among  the  poor  as  among  the  rich.  The  poor,  therefore,  having  in 
the  aggregate  more  capital  and  more  business  ability  than  the  rich,  as  well  as 
enormously  greater  physical  strength,  have  no  need  to  fear  the  encroachments 
of  concentrated  capital.  They  need  only  to  cooperate  to  fully  protect  them- 
selves. 


39 


Appendix  G, 


I.      STATISTICS   RELATING   TO    CURRENCY    QUESTIONS. 


1.  Object  and  Method  of  Study. — A  popular  study  of  the  "  Currency 
Question"  is  generally  understood  to  have  for  its  object  the  formation  of  a 
judgment  in  regard  to  the  effect  of  changes  in  the  character  and  volume  of  the 
currency  upon  the  standard  of  life.  From  the  standpoint  of  the  farmers  who, 
in  the  aggregate,  always  carry  an  enormous  permanent  indebtedness,  secured  by 
mortgage,  nothing  more  directly  affects  the  standard  of  living  than  the  ease  or 
difficulty  with  which  they  are  able  to  meet  the  interest  and  principal  of  this 
long-time  indebtedness ;  nor  is  there  any  better  index  of  the  farmer's  material 
prosperity  or  want  of  it,  than  the  extent  of  his  ability  to  meet  these  engage- 
ments promptly.  The  farmer  whose  debts  do  not  trouble  him  can,  and  usually 
does,  enjoy  the  comforts  of  life,  and  many  of  its  luxuries.  For  the  farmer, 
therefore,  nothing  is  more  important,  in  connection  with  the  currency,  than  its 
justice  as  a  standard  of  deferred  payments.  But  it  is  not  the  only  important 
thing  for  the  farmer  to  consider,  for  like  the  day  laborer,  who  may  own  no 
property,  the  farmer  is  also  a  large  buyer  of  commodities,  and  profits  by  the 
cheapness  of  such  as  he  has  to  buy. 

A  very  common  method  of  conducting  such  a  "  study  "  is  to  first  form  the 
"judgment,"  and  then  diligently  hunt  for  the  "statistics"  to  sustain  it. 
Sometimes  people  do  not  even  "  form  "  their  judgments,  but  accept  them  ready 
made  at  the  hands  of  some  political  or  social  orator  or  publication.  It  need 
not  be  said  that  this  is  a  very  bad  way  indeed  to  "  study  "  a  question.  No 
good  can  come  from  such  a  method.  A  much  better  way,  and  indeed  the  only 
good  way,  is  to  obtain,  so  far  as  possible,  all  the  statistical  facts  bearing  on  the 
problem,  arrange  them  in  an  orderly  and  logical  way  and  then  sit  down  and 
try  to  see  what,  when  thexj  are  all  taken  togcthei-,  they  prove.  Such  a  brief 
paper  as  this  appendix  pnust  be,  can  contain  only  a  few  summaries  from  the 
vast  quantity  of  the  statistics  which  have  been  gathered  upon  the  currency 
question,  nor  will  it  be  possible  to  include  as  imich  of  explanation  as  would  be 
desirable  for  those  not  familiar  with  these  studies;  but  an  attempt  has  been 
made  to  include  what  is  most  important,  including  all  that  are  commonly  used 
in  popular  discussion  in  this  country,  with  such  explanatory  matter  as  will 
enable  a  person  of  ordinary  education  to  reach  an  independent  judgment,  and 
feel  that  he  is  able  to  defend  it.  A  wrong  judgment  which  is  the  result  of 
(610) 


APPENDIX.  611 

independent  study  is  of  far  more  value  to  a  man  than  a  correct  judgment 
accepted  from  somebody  else;  for  one  man's  error  can  do  no  great  harm  to 
society,  while  the  acquirement  of  the  art  of  study  will  be  of  infinite  value  to 
the  man,  and  probably  enable  him,  in  due  time,  to  correct  early  erroneous 
judgments,  perhaps  founded  on  insufficient,  or  inaccurate  data.  The  proper 
order  of  topics  for  the  study  of  currency  questions  seems  to  me  to  be,  first,  the 
statistics  bearing  on  the  volume  of  currency;  secondly,  those  relating  to  the 
ratio,  past  and  present,  between  gold  and  silver,  and  finally,  those  relating  to 
prices. 

2.  Some  Cautions  about  the  Use  of  Statistics.— It  is,  perhaps,  desira- 
ble to  say  something  about  the  use  of  statistics.  In  the  first  place  they  are  not 
always  entirely  accurate,  because  in  the  nature  of  things  they  can  not  Be  made 
so.  The  receipts  and  expenditures  of  governments  can  be  stated  to  the  smallest 
fraction,  but  valuations  of  exports  and  imports,  for  example,  are  not  nearly  so 
accurate.  Valuations  made  for  the  purpose  of  assessment  of  ad  valorem  duties 
are  substantially  correct,  but  those  assigned  to  importations  to  be  sold  upon 
commission,  and  upon  which  the  duty  to  be  collected  is  "specific,"  are  some- 
times hardly  rough  approximations.  A  cargo  of  lemons,  for  example,  may  be 
certified  by  a  consul  in  Sicily  at  $1.50  per  box,  and  yet  not  actually  sell  for 
much  more  than  freight  money.  We  know  exactly  the  amount  of  gold  and 
silver  coined  in  all  countries,  for  a  long  period  back,  and  the  amownt  of  govern- 
ment, and,  usually,  of  bank  paper  money  in  circulation,  but  we  do  not  exactly 
know  the  movement  of  the  precious  metals,  coined  or  uncoined,  from  one  country 
to  another,  the  amount  used  in  the  arts,  or  the  stocks  of  them  in  the  world  at 
diflerent  periods,  or  at  present.  For  everything  not  the  subject  of  actual  book- 
keeping and  balance  sheets  we  are  dependent  upon  estimates.  These  estimates, 
however,  are  not  made  at  random.  They  are  the  work  of  capable  men  whose 
profession  is  the  compilation  and  arrangement  of  statistics,  wlio  are  fully  aware 
of,  and  carefully  consider  the  danger  of,  error,  and  give,  after  careful  considera- 
tion, their  judgment  of  the  facts.  In  such  matters  as  the  amounts  of  the 
precious  metals  in  the  world,  four  hundred  years  since,  when  the  study  of 
statistics  was  hardly  thought  of,  we  can  place  little  reliance  upon  the  tables, 
and  we  do  not  know  very  well,  even  to-day,  the  quantity  of  gold  and  silver 
annually  used  in  the  arts.  The  production  of  these  metals,  however,  has  for 
many  centuries  been  a  matter  of  government  record  in  all  civilized  countries, 
in  most  of  which  a  royalty  upon  the  product  of  mines  is  exacted  by  the 
government,  and  a  rigid  accounting  required.  In  our  own  country  no  such 
accounting  is  kept,  but  the  authorities  of  the  mint,  with  the  aid  of  the  express 
companies  and  banks,  make  a  very  close  approximation  to  our  production. 
From  such  semi-civilized  countries  as  China  statisticians  get  the  best  informa- 
tion possible  and  make  up  their  judgments  upon  it.  Gold  and  silver  passing 
from  one  country  to  another  by  sea,  as  freight  or  express,  must  be  entered  upon 
the  manifests  of  the  vessels,  and  is  recorded  in  custom  houses.  That  which 
passes  to  and  fro  upon  the  persons  of  travelers  must  be  estin.ated  or  disregarded. 
In  the  main  the  monetary  statistics  of  the  past  fifty  years,  so  far  as  they  are 
those  of  civilized  countries,  may  be  regarded  as  reliable,  for  what  they  purport 
to  be. 


612  APPENDIX. 

It  is  not,  however,  always  as  easy  as  it  might  seem  to  know  what  statistics 
really  teach  when  we  have  them.  For  example,  statistical  tables  and  diagrams 
which  follow  show  that  the  purchasing  power  of  gold  has  enormously  increased 
during  the  past  thirty  years,  and  that  the  farmer  who  for  that  period  has  kept 
alive  an  old  mortgage,  hy  renewals,  must  now  dispose  of  far  more  produce 
to  pay  the  deht,  than  would  have  paid  it  when  originally  contracted.  On  the 
other  hand,  tables  of  current  rates  of  interest,  for  the  same  period,  equally 
authentic,  and  indeed  with  less  liability  to  error,  show  that  in  1896  it  required 
twice  as  much  money  invested  in  gilt-edged  bonds,  to  produce  an  income  of 
$1,000,  as  would  have  produced  that  income  in  1870.  To  arrive  at  a  correct 
conclusion  these  two  tables,  possibly,  upon  analysis,  not  so  contradictory  as 
they  seem,  must  somehow  be  reconciled.  A  skilful  controversialist,  by  using 
only  one  set  of  these  tables,  can  make  an  argument,  unanswerable  by  a  popular 
audience,  which  will  show  that  debtors  are  suffering  very  severely  by  the  appre- 
ciation of  money,  and  immediately  thereafter  take  the  other  table  before  another 
audience,  and  with  equal  conclusiveness,  prove  that  the  poor  creditors  have 
practically  lost  half  their  debts.  One  can  prove  almost  anything  by  statistics, 
so  long  as  he  is  permitted  to  select  his  tables.  Imperfect  as  many  of  them  are, 
statistics  are  invaluable  for  the  study  of  economic  problems,  as  long  as  they  are 
intelligently  and  honestly  employed,  and  all  the  facts,  instead  of  only  part  of 
them,  are  considered.  This  is  sometimes  very  difficult.  Not  only  is  our 
information  limited,  but  our  mental  powers,  which  largely  accounts  for  the 
zeal  with  which  good  men  difler  on  economic  problems.  It  is  not  everyone  who 
has  the  intellectual  grasp  to  compass  great  subjects. 

Statistical  tables  make  a  very  dreary  looking  page  for  the  ordinary  reader, 
and  are,  of  course,  not  intended  to  be  read  by  any  one,  but  to  be  referred  to 
when  it  is  desired  to  make  use  of  the  fiicts  which  they  show.  For  the  purpose 
of  quickly  conveying  the  facts  of  statistical  tables  to  the  reader,  it  is  a  common 
practice  to  employ  diagrams,  drawn  to  a  scale,  upon  which  the  fluctuations  of 
the  tables  are  shown  by  lines.  This  is  a  very  useful  practice,  as  it  enables  the 
eye  to  take  in  at  a  glance  the  lesson  of  a  long  column  of  figures.  Like  many 
other  good  things,  however,  the  method  may  be  easily  abused,  and,  in  the 
hands  of  designing  persons,  be  made  to  convey  impressions  not  at  all  warranted 
by  the  facts.  The  trick  is  very  simple,  and  consists  merely  in  making  the 
vertical  spaces  of  the  scale  large  or  small,  in  relation  to  the  horizontal  spaces, 
according  as  the  draughtsmen  desire  to  convey  the  impression  of  great  or  small 
fluctuations.  For  example,  the  ratio  of  silver  to  gold  previous  to  1873  was 
constantly  fluctuating,  and  yet  the  variations  were  so  small,  that  popular 
discussions  of  the  relations  of  silver  and  gold  usually  take  no  account  of  them, 
and  silver  and  gold  are  often,  and  properly  enough,  represented  on  diagrams 
by  an  identical  line,  for  some  years  previous  to  1873.  It  would  bo  very  easy, 
however,  for  a  series  of  those  years,  by  constructing  a  diagram  in  which  vertical 
spaces  of  one  inch  should  represent  one  per  cent  of  variation,  and  horizontal 
spaces  of  one-half  inch  represent  years,  to  convey  the  impression  that  the 
ratios  of  the  two  metals  were  fluctuating  within  very  wide  limits.  The  increas- 
ing use  of  these  diagrams  in  popular  discussion,  sometimes  very  disingenuously, 
makes  it  proper  to  give  this  caution.     Economists  and  students,  and  political 


APPENDIX. 


613 


writers  in  their  private  studies,  pay  very  little  attention  to  diagrams  illustrating 
controverted  topics,  because  they  must  constantly  guard  against  false  impres- 
sions. They  study  the  tables,  and  if  they  desire  diagrams  thoy  construct  them, 
which  any  one  can  do  who  will  take  the  trouble  to  draw  the  spaces  evenly. 

I  can  best  illustrate  this  by  an  example,  and  for  this  purpose  will  take  a 
subject  which  is  illustrated  in  this  way  perhaps  more  frequently  than  any  other 
— the  variations  in  the  ratio  between  gold  and  silver  since  1873.  Diagrams  I., 
II.,  and  III.  represent  precisely  the  same  thing,  as  a  careful  inspection  will  show, 
and  yet,  when  drawn  separately,  upon  a  blackboard,  they  would  produce  a 
very  different  effect  upon  an  audience.  Diagram  I.  differs  from  II.  merely  in 
having  its  vertical  spaces  twice  as  large,  while  diagram  III.  differs  from  IT.  only 
in  having  the  horizontal  spaces  doubled.  They  all  represent  the  appreciation 
of  gold,  as  compared  with  commodities,  according  to  the  tables  of  the  London 
Economist,  for  the  period  covered.     (See  pages  614  and  615.) 

3.  Statistical  Authorities. — The  original  authorities  relating  to  the 
production  and  stocks  of  the  precious  metals,  and  emissions  of  paper  money,  are 
mainly  the  records  of  the  governments  of  the  world.  The  principal  nations  now 
publish  this  information  annually,  compiled  from  official  sources.  The  earlier 
estimates  were  compiled  by  eminent  statisticians  from  researches  in  govern- 
mental archives,  and  such  other  sources  as  in  their  judgment  are  entitled  to 
respect.  The  basis  of  confidence  is  in  the  competence  of  the  compiler.  None 
are  included  here  which  have  not  received  the  endorsement  of  the  Director  of  the 
United  States  Mint,  or  the  Finance  Committee  of  the  United  States  Senate  by 
being  included  in  official  publications.  The  same  may  be  said  as  to  the  table  of 
ratios.  In  regard  to  prices,  the  most  exhaustive  study  ever  made  in  any  country 
is  that  made  under  the  direction  of  a  sub-committee  of  the  Finance  Committee 
of  the  United  States  Senate,  and  found  in  Senate  Report  No.  l,394r,  Fifty-second 
Congress,  second  session  (1893).  The  period  covered  begins  with  1840,  and 
ends  with  1891.  These  tables  include  the  course  of  wholesale  prices  of  from  two 
to  three  hundred  articles  in  the  United  States.  These  tables  have  never  been 
continued.  There  are  many  similar  tables  compiled  by  statisticians,  of  which 
those  most  commonly  referred  to  are  those  of  Dr.  Augustus  Sauerbeck,  of 
London,  of  forty-five  articles  in  England,  and  the  London  Economist,  of 
twenty-two  commodities.  These  are  regularly  continued  each  year.  Another 
•  very  valuable  set  of  tables  is  that  of  Dr.  Adolf  Soetbeer,  of  Germany,  and 
continued,  after  his  death,  by  others.  These  tables  give  the  wholesale  prices  of 
one  hundred  commodities  in  Germany,  and  fourteen  English  articles.  Other 
recognized  statistical  authorities  are  the  Journal  of  the  Koyal  Statistical 
Society,  London,  which  is  made  up  of  original  contributions,  and  Mulhall's 
Dictionary  of  Statistics,  which  is  a  compilation.  For  convenient  reference 
Waldron's  Handbook  of  Currrency  and  Wealth  (Funk  &  "Wagnalls,  New 
York,  1896,  Price  fifty  cents)  is  an  excellent  compendium,  containing  most  of 
the  tables  to  which  it  is  usual  to  refer  in  discussing  currency  topics.  For  care- 
ful study  all  these  tables  require  the  aid  of  explanatory  matter  which  always 
accompanies  their  original  publication,  but  for  which  there  is  no  space  in  a 
compact  summary. 


614 


APPENDIX. 


APPRECIATION  OF  GOLD,  MEASURED  BY  ITS  PURCHASING  POWER. 
From  1873  to  1892.     From  Coinage  Laws  of  the  U.  S. 


40%  .3.-... 

30%   ,.,— 

-- 

..^ 

... 

I A 

1 

/ 

/ 

\ 

\ 

— 

N 

y 

/ 

20%  .- 
10%- 

/ 

^ 

/ 

--- 

\ 

■/- 

/ 

For  explanation  of  Diagrams  I.  1 1,  and  1  IT.,  see  previous  page. 


AITENDIX. 


615 


ti.  .5  -2 


o    =    ^    o 


■5   ^ 


3S       .   —;     o 


-    a,w2 

o 


H  ><;  ■« 


616 


APPENDIX. 


4.     THE   WORLD'S  STOCK  OF  GOLD  AND  SILVER. 

WORLD'S  STOCK   OF  GOLD. 


Year. 

Coined. 

Uncoined. 

TotaL 

Coined. 

Uncoined. 

Total. 

Tons. 

Tons. 

Tons. 

Fine  ounces. 

Fine  ounces. 

Fine  ounces. 

1600 

208 

622 

830 

6.795,000 

20,318,000 

27,113,000 

1700 

537 

773 

1,310 

17,542,000 

25,251,000 

42,793,000 

1800 

908 

1,822 

2,730 

29,661,000      59,519,000 

89,180,000 

1848 

1,125 

2,450 

3,575 

36,750.000 

80,033,000 

116,783,000 

1873* 

4,650 

2,550 

7,200 

151,900.000 

83,300,000 

235,200,000 

1880 

5,250 

2,550 

7,800 

171,500,000 

83,300,000 

254,800,000 

1890 

5,640 

3,180  1  8,820 

184,240,000 

103,880,000 

288,120,000 

1894* 

6,300 

3,300  1  9,600 

205,800.000 

107,800,000 

313,600,000 

WORLD'S  STOCK   OF  SILVER. 


Year. 

Coined. 

Uncoined. 

TotaL 

Coined. 

Uncoined. 

Total. 

Tons. 

Tons. 

Tons. 

Fine  ounces. 

Fine  ounces. 

Fine  ounces. 

1600... 

8,500 

14,500 

23,000 

277,667,000 

473,666, 0(!0 

751,333,000 

1700... 

22,500 

22,500 

45,000 

735,000,000 

735,000,000 

1,470,000,000 

1800... 

42,000 

46,000 

88,000 

1,372,000,000 

1,502.667,000 

2,874667,000 

1848... 

45,200 

07,800 

113,000 

1,476,53.3,000 

2,214,800,000 

3,691,333,000 

1873* 

64,500 

75,  .500 

135,000 

2,107,000,000 

2,303,000,000 

4,410,000,000 

1880... 

73,700 

71,300 

145,000 

2,407,533,000 

2,329,134,000 

4,736,667,000 

1890... 

88, 100 

76,900 

165,000 

2,877,933,000 

2,512,067,000 

5,390,000,000 

1894*. 

99,900 

80,100 

180,000  3,263,400,000 

2,616,600,000 

5,880,000,000 

COMPARISONS  OF  THE  TWO   METALS. 


Year. 

Per  cent  coined. 

Ounces  of  silver  to  one  of  gold. 

Per  ct.  annu'y 
added  to  stock. 

Gold. 

Silver. 

Coined. 

Uncoined. 

Total. 

Gold. 

Silver. 

1600 

25.1 
41.0 
33.3 
31.5 
64.6 
67.3 
63.9 
65.6 

37.0 
60.0 
47.0 
40.0 
47.8 
50.8 
53.4 
55.6 

40.9 
41.9 
463 
40.2 
13.9 
14.0 
15.6 
15.9 

23.3 
29.1 
25.2 
27.7 
27.6 
28.0 
24.2 
24.3 

27.7 
34.3 
32.2 
31.6 
18.7 
18.6 
18.7 
18.7 

0.94 
0.88 
0.64 
1.53 
1.98 
2.02 
2.00 
2.77 

1.80 

1700 

0.76 

1800 

1848 

0.99 
0.82 

1873* 

1880 

1.66 
1.56 

1890 

1894* 

2.34 
2.82 

*  Estimates  for  the  years  1873  and  1894  are  made  by  Mr.  G.  B.  Waldron,  based  on  the 
world's  production  and  coinage.  Estimates  for  other  years  in  tons  on  the  authority  of 
Mulhall.  Converted  into  fine  ounces  at  the  rate  of  32%  thousand  ouuce.s  to  the  ton  of 
2240  pounds. 


APPENDIX.  61*7 

5.     WORLD'S  PRODUCTION  OF  GOLD  AND  SILVER  FROM  1492. 

\ 

From  1493  to  1840  the  estimates  are  those  of  Dr.  Adolph  Soetbeer;  after  1840  of  the  U.  S. 
Mint. 


World's  production  of  gold. 

World's  production  of  silver. 

Fine  ounces. 

Value. 

Fine  ounces. 

Coining  value. 

1493-1520 

5,221,160 
5,524,656 

$107,931,000 
114,205,000 

42,309  400 

$  54,703,000 

1521-1540 

69,598,320 

89,986,000 

1541-1560 

4,377,544 
4,398,120 

90,492,000 

160,287,040 

207,240,000 

1561-1580 

90,917,000 

192,578,500 

248,990,000 

1581-1600 

4,745,340 

98,095,000 

269,352,700 
271,924,700 

348,254,000 

1601-1620 

5,478,360 

113,248,000 

351,579,000 

1621-1640 

5  336,900 

110,324  000 

253,084,800 

327,221,000 

1641-1660 

5,639,110 

116,571,000 

235,530,900 

304,525,000 

1661-1680 

5,954,180 

123,084,000 

216,691,000 

280,166,000 

1681-1700 

6,921,895 

143,0SS,000 

219,841,700 

284,240.000 

1701-1720   . 

8  243,260 

170,403,000 

228,650,800 
277,261,600 

295,629,000 

1721-1740 

12,268,440 

253,611,000 

358,480,000 

1741-1760 

15,824,230 

327,116,000 

342,812,235 

443,232,000 

1761-1780 

13,313,315 

275,211,000 

419,711,820 

542,658,000 

1781-1800 

11,438,970 

236,464,000 
118,152,000 

565,235,580 

730,810,000 

1801-1810 

5,715,627 

287,469,225 

371,677,000 

1811-1820  

3,679,568 

76,063,000 

173,857,555 

224,786,000 

1821-1830 

4,570,444 

94,479,000 

148,070,040 

191,444,000 

1831-1840 

6,522.913 

134,841,000 

191,758,675 

247,930,000 

1841-1848 

14,084,090 

291,144,000 

200,732,500 

259,520,000 

1849 

1,7S9,875 

37,000  000 

30,164,000 

39,000,000 
39,000,000 

1850 

2,150,269 

44,450,000 

30,164,000 

1851 

3,270,150 

67,600,000 

30,937,500 

40,000,000 

1852 

6,421,781 

132,750,000 

31,402  000 

40,600,000 

1853 

7,519,894 

155,450,000 

31,402,000 

40,600,000 

1854 

6,165,378 
6,534,253 

127,450,000 
135,075,000 

31,402,000 
31,402,000 

40,600,000 

1855 

40,600,000 

1856 

7,140,150 

147,600,000 

31,440,800 

40,650,000 

1857 

6,447,177 

133,275,000 

31,440,800 

40,650,000 

1858 

6,029,944 

124,650,000 

31,440,800 

40,650,000 

1859 

6,039,619 

124,850,000 

31,517,600 

40,750,000 

1860 

5,758,719 

119,250,000 

31,556.250 

40,800,000 

1861 

5,505,075 

113,800,000 

34,572,700 

44,700,000 

1862 

5,212,406 

107,750,000 

34,959,400 

45,200,000 

1863 

5,173,706 

106,950,000 

38,053,000 

49,200,000 

1864 

5,466,375 

113,000,000 

39,986,700 

51,700,000 

1865 

5,814,675 

120,200,000 

40,180,000 

51,950,000 

1866 

5,858,213 

121,100.000 

39,252,000 

50,750,000 

1867 

5,043,094 

104,025  000 

41,939,600 

54.225,000 

1868 

5,307,947 

109,725,000 

38,845,900 

50,225,000 

1869 

5,138,634 

106,225  000 

36,738,200 

47,500,000 

1870 

5,168,869 

106,850,000 

39,890,000 

51,575,000 

1871 

5,176,125 

107,000.000 

47,183,600 

61.050,000 

1872.. 

4,818,150 

99.600,000 

50,466,800 

65,250.000 

1873 

4,653  675 

96.200,000 
90,750,000 

63,267,000 

81,800,000 

1874 

4,390,031 

55,300,000 

71,500,000 

1875 

4,726,563 

97,500,000 

62,262,000 

80,500,000 

1876 

5,016,488 
5,514.750 

103,700,000 
114,000,000 

67,753,000 
62,648,000 

87,600,000 

1877 

81,000,000 

618 


APPENDIX. 


world's  production  of  gold  and  silver.    (Continued.) 


World's  production  of  gold. 

World's  production  of  silver. 

Fine  ounces. 

Value. 

Fine  ounces. 

Coining  value. 

1878 

1879 

5,757,625 

5,272,875 
5,141,938 
4,982,625 
4,933,250 
4,614,975 
4,919,738 
5,243,850 
5,127,750 
5,116,866 
5,330,780 
5,973,780 
5,749,272 

39,412,823 
9,804,748 

11,489,291 

119,000,000 
109,000,000 
106,500,000 
103,000,000 
102,000,000 
95,400,000 
101,700,000 
108,400,000 
106,000,000 
105,775,000 
110,197,000 
123,489,000 
118,848,700 
814,736,000 
202,682,300 
237,504,800 

73,476,000 

74,250,000 

74,791,000 

78,890,000 

86,470,000 

89,177,000 

81,597,000 

91,652,000 

93,276,000 

96,124,000 

108,827,000 

120,213,600 

126,095,000 

787,906,656 

168,178,550 

183,096,090 

95,000,000 
96,000,000 

1880 

96,700,000 

1881 

102,000,000 

1882 

111,800,000 

1883 

115,300,000 

1884.. 

1885 

105,500,000 
118,500,000 

1886 

120,600,000 

1887 

124,281,000 

1888 

1889 

140,706,000 
155,427,700 

1890 

163,032,000 

1891-1895       .  .. 

1,018,708,000 

1896 

217,442,900 

1897 

236,730,300 

1493-1600 

24,266,820 
29,330,445 
61,088,215 

f  501,640,000 

606,315,000 

1,262,805,000 

734,125,960 
1,197,073,100 
1,833,672,035 

$      949,173,000 

1601-1700 

1,547,731,000 

1701-1800 

2,370,809,000 

1801-1848 

34,572,643 
128,949,609 
122,207,901 

$   714,679,000 
2,665,625,000 
2,526,261,500 

1,001,887,995 
856,-361,850 

2,125,713,261 

1 

$1,295,357,000 

1849-1872 

1,107,215,000 

1873-1894 

2,748,396,900 

1801-1894 

285,730,153 

15,906,565  500 

3,983,963,106 

$5,150,968,900 

1493-1897 

446,017,990 

$9,220,012,100 

8,531,339,167 

*$10,977,685,200 

*  It  will  be  noted  that  the  total  here  given  is  the  "coining"  value,  presumably  at 
the  ratio  of  15.98  to  1,  as  the  footing  is  that  of  the  U.  S.  Mint.  (Report  for  1898,  page 
273.)    The  commercial  value  would  of  course  be  less  than  half  as  much. 


6.     RATIO   OF  SILVER    TO   GOLD   FOR  400    FEARS. 


It  would  be  quite  natural  to  suppose  that  the  commercial  ratio  of  silver  to 
gold  would  bear  a  somewhat  close  relation  to  the  ratio  of  production.  The  fol- 
lowing table  was  arranged  and  apparently,  in  part,  computed  by  Mr.  Geo.  B. 
Waldron,  and  is  from  his  Handbook  of  Currency,  It  shows  that  the  commer- 
cial ratio  has  no  apparent  connection  with  the  ratio  of  production.  Concerning 
this  table  Mr.  Waldron  says:  "We  have  prepared  the  table  below  showing 
the  amount  of  silver  produced  to  one  unit  of  gold  in  dollars  and  in  ounces  for 
each  of  the  periods  of  the  table  of  production.  For  purposes  of  comparison 
we  have  added  Dr.  Soetbeer's  estimates  of  the  commercial  ratio  of  gold  to  silver 
down  to  1832,  the  estimates  of  Pixley  and  Abell  from  1833  to  1878,  and  those 
of  the  Director  of  the  Mint  from  1879  to  1894." 


APPENDIX. 


619 


RATIO   OF   SILVER  TO   GOLD. 


Calendar 
Years. 

Silver 
produced  to 
one  of  gold. 

Commercial 
ratio. 

Calendar 
Years. 

Silver 
produced  to 
one  of  gold. 

Commercial 
ratio. 

1493-1520.. 
1521-1540.. 
1541-1560.. 
1561-1580.. 
1581-1600.. 

1601-1620.. 

Ounces. 

8.10  to    1 
12.60     " 
36.62     " 
43.79     " 

56.76  " 

49.64     " 
47.44     " 

41.77  " 

36.39  " 
31.76     " 

27.74     " 
22.60     " 
21.66     " 
31.53     " 
49.41     " 

50.30     " 
47.25     " 

32.40  " 
29.40     " 
14.25     " 

16.85     " 
14.03     " 
9.46     " 
4.89     " 
4.18     " 
5.09     " 
4.81     " 
4.40     " 
4.88     " 

5.21  " 

5.22  " 
5.48     " 
6.28     " 
6.71     " 
7.36    " 

7.31  " 
6.91     " 
6.70    " 

8.32  " 

11.30  to  1 

11.20  " 
11.50     " 
11.50     " 
11.90     " 

13.00     " 
13.40     " 
13.80     " 
14.70     " 
14.97     " 

15.21  " 
15.09     " 

14.75  " 
14.73     " 
15.09     " 

15.61     " 

15.49  " 
15.80     " 

15.76  " 
15.85     " 

15.78     " 
15.70     " 
15.46     " 
15.59     " 
15.33     " 
15.33     " 
15.38     " 
15.38     '' 
15.27     " 
15.38     " 
15.19     " 
15.29     " 

15.50  " 
15.35     " 
15.37     " 
15.37     " 
15.44     " 
15.43     " 
15.57     " 

1868 

1869  

Ounces. 
7.32   to    1 
7.15     " 
7.72     " 
9.12     " 

10.47  " 

13.59  " 

12.60  " 

13.17     '« 
13.51     " 
11.36     " 
12.76     " 
14.08     " 
14.55     " 
15.83     " 
17.53     " 
19.32     " 
16.59     " 

17.48  " 
18.19    " 
18.79     «« 
20.41     " 
20.12     " 
21.93     " 
21.70     " 
21.63     " 
21.27     " 
18.89     " 
17.15     " 
15.93     " 

15.59  to  1 

15.60  " 

1870     

15.57     " 

1871    

15.59     " 

1872 

15  63     " 

1873 

1874 

15.92     " 
16.17     " 

1621-1640.. 
1641-1660.. 
1661-1680.. 
1681-1700.. 

1875 

16.59     " 

1876 

17.88     " 

1877 

17.22     " 

1878 

17.94     " 

1701-1720.. 

1879... 

18.40    " 

1721-1740.. 

1880 

18.05     " 

1741-1760.. 

1881 

18.16     " 

1761-1780.. 
1781-1800.. 

1882 

1883 

18.20     " 
18.64    " 

1884 

18.57     " 

1801-1810.. 

1885    

19.41     " 

1811-1820.. 

1886      

20.78     " 

1821-1830.. 
1831-1840.. 

1887 

1888     

21.13     " 
21.99     " 

1841-1848.. 
1849 

1889 

1890 

22.10     " 
19.76     " 

1850 

1891 

20.92     " 

1851 

1892 

23.72     " 

■toco 

1893 

26.49     " 

1853  

1854 

1894 

1896 

32.59     " 
30.66     " 

1855 

1897 

34.28     " 

1856 

1493-1600.. 
1601-1700.. 
1701-1800.. 

1801-1848.. 
1849-1872.. 
1873-1894.. 

1801-1894.. 

1493-1894.. 

30.25     " 
40.81     " 
30.02    " 

1857 

11.48     " 

1858 

13.97     " 

1859 

14.97     " 

1860  

1861 

28.98     " 
6.64     " 
17.39     " 

15.69     " 

1862 

15.48     " 

1863 

20.22     " 

1864 

13.94     " 

1865 

16.65     " 

1866 

19.34     " 

1867 

13.95     " 

It  will  be  interesting  to  note  whether  there  is  any  closer  connection  between 
the  commercial  ratio  of  gold  and  silver,  and  the  ratio  of  existing  stocks.  I  have 
therefore  computed  this  ratio  from  the  table  of  world's  stocks  on  page  616. 


620  APPENDIX. 

COMMERCIAL    RATIO    AND    RATIO    OF   STOCKS. 


Total  Gold 

Total  Silver 

Commercial 

Year. 

Coined  and 

Coined  and 

Ratios  of  Stocks. 

Ratio. 

Uncoined. 

Uncoined. 

Tons. 

Tons. 

1600 

830 

23,000 

27.71  to  1 

12.10  to  1 

1700 

1,310 

45,000 

34.35    " 

14.81    " 

1800 

2,730 

88,000 

32.23    " 

15.68    " 

1848 

3,575 

113,000 

31.61    " 

15.85     " 

1873 

7,200 

135,000 

18.33    " 

15.92    " 

1880 

7,800 

145,000 

18.72    " 

18.05    " 

1890 

8,820 

165,000 

18.71    " 

19.76    " 

1894 

9,600 

180,000 

18.75    " 

32.56    " 

The  form  in  which  tables  are  given  in  the  report  of  the  Director  of  the  Mint 
for  1898  does  not  permit  me  to  conveniently  continue  the  calculation  of  Mr. 
Waldron,  but  the  totals  of  production  as  estimated  by  the  mint  from  1493  to  July 
1,  1898,  make  the  total  stock  at  that  time  18.72  fine  ounces  of  silver  to  one  of 
gold.  The  commercial  ratio  for  1897,  as  given  in  the  report  (average  for  the 
year),  was  84.28  to  1,  and  for  nine  months  of  1898,  35.40  to  1. 

COMMERCIAL    RATIO. 

Early  Katios. — The  commercial  ratio  of  gold  to  silver,  from  the  time 
of  Herodotus  (born  484  b.  c.)  down  to  the  year  1717,  is  shown  in  the  following 
from  the  letter  of  Lord  Liverpool  to  the  king  of  Enghind  (see  "Coinage  Laws 
of  the  United  States,  1894,"  page  435):— 

In  Persia,  according  to  Herodotus 1  to  1  If 

In  Greece  at  same  period 1  to  13 

In   Greece  in  the  time  of  Plato 1  to  12 

In  Greece  it  is  stated  bj"-  Xenophon  at 1  to  10 

After  the  plunder  of  gold  from  the  Temple  of  Apollo,  ac- 
cording to  Menander,  it  was 1  to  10 

In  the  reign  of  Alexander  the  Great  it  was 1  to  10 

In  Rome,  according  to  Pliny  the  Elder  it  was 1  to  IQi  g 

In  Eome,  after  the  tribute  from  the  Etolians 1  to  10 

The   plunder  of   gold   from    the   Gauls   by 

Julius  Cajsar  reduced  the  proportions  to 1  to    7^ 

In  the  reign  of  Claudius,  Tacitus  states  it  at 1  to  12J 

Until  the  reign  of  Alexander  Servius  it  contained.    .    .    .  1  to  12i 

In  the  reign  of  Constantino  the  Great 1  to    IJ 

The  disorders  in  the  Roman  Empire  under  Arcadus  and 

Honorius  raised  it  to 1  to  14§ 

From  which  it  appears  that  gold,  unless  when  depressed 
by  sudden  and  unusual  occurrences,  or  enhanced  by  a 
dread  of  public  insecurity,  may  be  stated  to  have  been 
for  upward  of  900  years  in  the  proportion  of.  .    .    .    .  1  to  10  or  12 


APPENDIX. 


621 


In  England,  in  the  reign  of  Henry  III.,  1216  to  1272  .  .  1 
In  England,  in  the  reign  of  Edward  III.,  1330  to  1377.  ,  1 
In  England,  in  the  reign  of  Henry  IV.,  1400  to  1412  .  .  1 
In  England,  in  the  reign  of  Edward  IV.,  1461  to  1477.  .  1 
In  England,  in  the  reign  of  Henry  VIII.,  1510  to  1547  .  1 
In  England,  in  the  reign  of  Queen  Elizabeth,  1560  ."  . 
In  England,  in  the  reign  of  King  James  I.,  1604  .  .  . 
In  England,  in  the  reign  of  King  James  I.,  1611,    .    . 

In  England,  in  the  reign  of  Charles  II.,  1605 

In  England,  in  the  reign  of  George  I.,  1717 

Relative  proportions  in  China,  according  to  Humboldt. 
Relative  proportions  in  Japan,  according  to  Humboldt 
Relative  proportions  in  Bengal,  according  to  bullion  reportl 
Relative  proportions  in  Madras,  according  to  bullion  reportl 
Relative  proportions  in  Bombay,  according  to  bullion  reportl 
In  the  China  diaries  it  is  stated  at  16  taels  of  silver  to  1  tael 
of  gold  of  100  touch  of  pure  gold.     If  it  is  meant  to  be 
of  pure  silver  also,  the  proportion  would  be  1  to  16;  but 
it  is  believed  to  be  the  average  fineness  of  silver  in  dol- 
lars, which  would  be 1 


to    9J 
tol2J 
tolOi 
to  Hi 
to  11.10 
toll 
to  121 
to  13J 
to  14^ 
to  151 
to  12^ 
to    8J 
to  14.86 
to  13| 
to  15 


to  14.296 


LEGAL    RATIOS    IN    THE    UNITED   STATES. 

Act  of  1792.  .    .-    .    .    .  15  to  1 Silver  standard. 

Act  of  1834.  !    .    .    .    .  16.002  to  1..    .    .  Silver  standard  (apparently). 

Act  of  1837 15.98+to  1.  .    .    .  Bimetallic  standard. 

Act  of  1873 15.98+to  1  .    .    .  .Gold  stanjiard. 

There  has  been  no  change  in  the  legal  ratio  since. 


COMMERCIAL  RATIO  OF  SILVER  TO  GOLD  EACH  YEAR— 1867  TO  1898. 

[Note.— From  1687  to  1832  the  ratios  are  taken  from  Dr.  A.  Soetbeer ;  from  1833  to  1878, 
from  Pixley  and  Abell's  tables;  and  from  1879  to  1898  from  daily  cablegram.?  from  Lon- 
don to  the  Bureau  of  the  Mint.    Report  of  the  Director  to  the  Mint,  1898. 


Year. 

Ratio. 

Year. 

Ratio. 

Year. 

Ratio. 

Year. 

Ratio. 

YEAR. 

Ratio. 

1687 

U.M 

1700 

14.81 

1713 

15.24 

1726 

15.15 

1739 

14.91 

1688 

14.94 

1701 

15.07 

1714 

15.13 

1727 

15.24 

1689 

15.02 

1702 

15.52 

1715 

15.11 

1728 

15.11 

1740 

14.94 

1703 

15.17 

1716 

15.09 

1729 

14.92 

1741 

14.92 

1690 

15.02 

1704 

17.22 

1717 

15.13 

1742 

14.85 

1691 

14.98 

1705 

15.11 

1718 

15. n 

1730 

14.81 

1743 

14.85 

1692 

14.92 

1706 

15.27 

1719 

15.09 

1731 

14.94 

1744 

14.87 

1693 

14.83 

1707 

15.44 

1732 

15.09 

1745 

14.98 

1694 

14.87 

1708 

15.41 

1720 

15.04 

1733 

15.18 

1746 

15.13 

1695 

15.02 

1709 

15.31 

1721 

15.05 

1734 

15.39 

1747 

15.26 

1696 

15.00 

1722 

15.17 

1735 

15.41 

1748 

15.11 

1697 

15.20 

1710 

15.22 

1723 

15.20 

1736 

15.18 

1749 

14.80 

1698 

15.07 

1711 

15.29 

1724 

15.11 

1737 

15.02 

1699 

14.94 

1  1712 

15.31 

1725 

15.11 

1738 

14.91 

1750 

14.55 

622  APPENDIX. 

COMMERCIAL  RATIO  OF  SILVER  TO  GOLD.    (Continued.) 


Year 

Ratio. 

Year. 

Ratio. 

Year. 

Ratio. 

Year. 

Ratio. 

Year. 

Ratio. 

1751 

14.39 

1781 

14.78 

1811 

15.53 

1841 

15.70 

1871 

15.57 

1752 

14.54 

1782 

14.42 

1812 

16.11 

1842 

15.87 

1872 

15.63 

1753 

14.54 

1783 

14.48 

1813 

16.25 

1843 

15.93 

1873 

15.92 

1754 

14.48 

1784 

14.70 

1814' 

15.04 

1844 

15.85 

1874 

16.17 

1755 

14.68 

1785 

14.92 

1815 

15.26 

1845 

15.92 

1875 

16.59 

1756 

14.94 

1786 

14.96 

1816 

15.28 

1846 

15.90 

1876 

17.88 

1757 

14.87 

1787 

14.92 

1817 

15.11 

1847 

15.80 

1877 

17.22 

1758 

14.85 

1788 

14.65 

1818 

15.35 

1848 

15.85 

1878 

17.94 

1759 

14.15 

1789 

14.75 

1819 

15.33 

1849 

15.78 

1879 

18.40 

1760 

14.14 

1790 

15.04 

1820 

15.62 

1850 

15.70 

1880 

18.05 

1761 

14.54 

1791 

15.05 

1821 

15.95 

1851 

15.46 

1881 

18.16 

1762 

15.27 

1792 

15.17 

1822 

15.80 

1852 

15.59 

1882 

18.19 

1763 

14.99 

1793 

15.00 

1823 

15.84 

1753 

15.33 

1883 

18.64 

1764 

14.70 

1794 

15.37 

1824 

15.82 

1854 

15.33 

1884 

18.57 

1765 

14.83 

1795 

15.55 

1825 

15.70 

1855 

15.38 

1885 

19.41 

1766 

14.80 

1796 

15.65 

1626 

15.76 

1856 

15.38 

1886 

20.78 

1767 

14.85 

1797 

15.41 

1827 

15.74 

1857 

15.27 

1887 

21.13 

1768 

14.80 

1798 

15.59 

1828 

15.78 

1858 

15.38 

1888 

21.99 

1769 

14.72 

1799 

15.74 

1829 

15.78 

1859 

15.19 

1889 

22.10 

1770 

14.62 

1800 

15.68 

1830 

15.82 

1860 

15.29 

1890 

19.76 

1771 

14.66 

1801 

15.46 

1831 

15.72 

1861 

15.50 

1891 

20.92 

1772 

14.52 

1802 

15.26 

1832 

15.73 

1862 

15.35 

1892 

23.72 

1773 

14.62 

1803 

15.41 

1833 

15.93 

1863 

15  37 

1893 

26.49 

1774 

14.62 

1804 

15.41 

1834 

15.73 

1864 

15.37 

1894 

32.56 

1775 

14.72 

1805 

15.79 

1835 

15.80 

1865 

15.44 

1895 

31.60 

1776 

14.55 

1  1806 

15.52 

1836 

15.72 

1S66 

15.43 

1896 

30.66 

1777 

14.54 

1807 

15.43 

1837 

15.83 

1867 

15.57 

1897 

34.28 

1778 

14.68 

i  1808 

16.08 

1838 

15.85 

1868 

15.59 

*1898 

35.40 

1779 

14.80 

1809 

15.96 

1839 

15.62 

1869 

15.60 

1780  14.72 

1810 

15.77 

1840 

15.62 

1870 

15.57 

*  Nine  months. 


7.     DEMONETIZATION  OF  SILVER. 

Up  to  the  year  1816,  both  silver  and  gold  were  recognized  and  coined  as  full 
legal  tender  in  all  civilized  countries;  and  for  many  years  after  the  two  metals 
circulated  freely  together  at  a  ratio  between  fifteen  and  sixteen  to  one.  At 
present  the  only  countries  nominally  upon  a  bimetallic  basis  are  the  United 
States  and  Latin  Union  and  certain  countries  in  which  neither  metal  circulates 
by  reason  of  an  inflated  paper  currency.  All  other  countries  are  upon  either  a 
gold  or  silver  basis.  The  United  States,  although  nominally  on  a  bimetallic 
l)asis,  is  really  upon  a  gold  basis,  by  reason  of  the  pledge  of  the  United  States 
to  maintain  its  silrer  coinage  on  a  par  with  gold,  at  the  ratio  of  fifteen  and 
ninety-eight  one-hundred ths  to  one.  "Demonetization  "  of  a  metal  consistB  in 
depriving  it  of  its  character  as  legal  tender,  except  for  small  sums.  Partial 
demonetization  occurs  when  a  metal  is  refused  coinage  at  the  mints  for  private 


APPENDIX. 


623 


account,  even  though,  as  in  India,  United  States,  the   Latin  Union  and  else 

where,  it  continues  to  circulate  as  full   legal   tender  money.      The  principal 

dates  in  connection  with  the  demonetization  of  silver  are  as  follows: — 

1816.  England  adopted  gold  standard. 

1849.  Brazil  adopted  gold  standard. 

1854.  Portugal  adopted  gold  standard. 

1867.  First  International  Monetary  Conference  in  Paris. 

1871.  Germany  adopted  gold  standard.     In  effect  1873. 

1872.  Netherlands  suspended  coinage  of  silver  per  private  account. 

1873.  United  States  adopted  gold  standard. 

Suspension  of  silver  coinage  for  private  account  in  France,  Belgium,  and 
Holland. 

Denmark,  Sweden,  and  Norway  (Scandinavian  Union)  adopted  gold 
standard. 

Suspension  of  coinage  of  silver  for  private  account  in  Italy  and  the 
Dutch  colonies. 

Finland  adopted  gold  standard. 

Remonetization  of  silver  by  the  United  States  and  provision  for  the  pur- 
chase and  coinage  into  silver  dollars  of  silver  to  the  value,  at  market 
price,  of  not  less  than  |2,000,000  and  not  more  than  $4,000,000 
per  month.  Coinage  of  silver  for  private  account  prohibited. 
(Bland-Allison  Act.) 

Second  International  Monetary  Conference  at  Paris. 

Third  International  Monetary  Conference  at  Paris. 

Russia  suspended  coinage  of  silver  for  private  account. 

United  States  Congress  repeals  act  of  1878,  and  directs  the  purchase  of 
4,500,000  fine  ounces  of  silver  per  month  to  be  coined  at  the  rate  of 
2,000,000  ounces  per  month  until  July  1,  1891,  and  thereafter  as 
might  be  required. 

1892.  Austro-Hungary  adopted  gold  standard. 

1893.  India  suspends  coinage  of  silver  for  private   account,  and   the  United 

States  repeals  purchasing  clause  of  the  act  of  1890. 
1895.  Chili  adopted  gold  standard. 
.1896.  Costa  Rica  adopted  gold  standard. 
.1897.  Japan  and  Russia  adopted  gold  standard. 

Peru  suspended  coinage  of  silver  for  private  account. 


1875. 


1877. 
1878. 


1881. 
1885. 
1890. 


PURCHASES  OF  SILVER  UNDER  THE  ACT  OF  JULY  14,  1890. 


Year. 
Ending 
June  30. 

Fine  ounces. 

Cost. 

Coinage 
value. 

Seignor- 
age.  6 

Average 
cost  per 
ounce. 

1891a 

1892 

48,393,413.05 
54,355,748.10 
54,008,162.60 
11,917,658.78 

$50,577,498,44,  $62,568,873 

51,106,607.96      70,278,139 

45,531,374.53      69,828,736 

8,715,521.32      15,408,690 

$11,991,375 

19,171,531 

24,297,361 

6,693,169 

$1.0451 
.9402 

1893 

.8430 

"    Nov.  1 

.7313 

Total 

168,674,682.53 

$155,931,002.25  $218,084,438 

$62,153,436 

$  .9244 

Beginning  Aug.  13,  1890.     6  Coinage  value  less  cost. 


624  APPENDIX. 

COINAGE  OF  SILVER  DOLLARS,  ACT  OF  JULY  14,  1890. 


Year 
Ending 
June  30. 

Dollars 
Coined. 

Fine 

ounces 

used. 

Cost  of 
bullion. 

Aver'ge 
cost  of 
a  dollar 

Purchased  but 
not 
coined. 

1891* 

$27,292,475 

3,450,995 

5,343,715 

100 

21,109,023.63 

2,669,128.95 

4,133,029.56 

77.35 

$22,747,860.42 

2,577,838.19 

3,784,417.64 

70.36 

$0.8335 
.7470 
.7082 
.7036 

10.8067 
.7000 
.8762 

$39,795,546.15 

1892     

67  682,227.57 

1893    

66,027,008.11 

1893,  Nov.  1 

15,406,933.92 

1694t 

$36,087,285 

658 

3,956,011 

27,911,259.49 

508.92 

3,059,727.26 

30,971,495.67 

$29,110,186.61 

460.63 

2,680,825.10 

$188,911,715.75 
188,911,206.73 

1895 

185,851,479.47 

Total 

$40,043,954 

$31,791,472.34 

$185,851,479.47 

Beginning  Aug.  13,  1890.     f  Beginning  Nov.  1,  1893. 

LONDON  GOLD,  PRICE  OF  SILVER,  PER  OUNCE  STERLING  FROM  1870. 


1870 

..$1,328 

1875.. 

.$1,246 

1880. 

.$1.1451885. 

.$1,065 

1890. 

.$1,046 

1895..$ 

.654 

1871 

...1.326 

1876, 

...1.156 

1881. 

...1.138 

1886. 

...  .995 

1891.. 

...  .988 

1896... 

.674 

187?, 

...1.322 

1877 

...1.201 

1882. 

...1.136 

1887. 

...  .978 

1892. 

...  .871 

1897... 

.604 

1873 

...1.298 

1878 

...1.152 

1883.. 

...1.110 

1888. 

...  .939 

1893.. 

...  .780 

1898*.. 

.583 

1874.. 

....1.278 

1879.. 

...1.123 

1884. 

...1.113 

1889. 

...  .935 

1894. 

...  .635 

*  Nine  months. 

MONETARY  SYSTEMS  OF  THE  WORLD. 
The  present  monetary  systems  of  the  countries  of  the  world  are  as  follows: 

(FROM    REPOKT   OF    DIRECTOR   OF    THE    MINT    1898.) 

AusTRO-HuNGARY— Gold.     Actual  currency  government  paper. 

Belgium — See  Latin  Union. 

Bolivia — Silver. 

Brazil — Gold.     Actual  currency  inconvertible  paper. 

British  India— Silver.     Silver  coined  only  on  government  account. 

Bulgaria— Gold  and  silver.     Has  no  mint. 

Canada — Gold. 

Costa  Kica — Gold. 

Chili — Gold.     Actual  currency  paper.  .  .   •  ,  : 

China — Silver. 

Cuba— Same  as  Spain.     See  Latin  Union. 

Columbia— Silver.     Actual  currency  paper. 

Denmark — See  Scandinavian  Union. 

Ecuador— Silver.     Actual  currency  depreciated  paper. 

Egypt — Gold. 

Finland— Gold. 

Germany — Gold. 

Great  Britain  and  Colonies — Gold. 

Grkece. — See  Latin  Union. 

Haiti— Gold.     Actual  currency  depreciated  paper. 

Japan — Gold. 

Latin   Union  (France,    Belgium,    Italy,  Switzerland  and  Greece)— Gold 

and  silver.     Silver  not  coined  for  private  account. 
Mexico — Silver. 

Netherlands — Gold,  with  silver  coined  previous  to  1875. 
Norway — See  Scandinavian  Union. 
Paraguay— Silver.     Actual  currency  depreciated  paper, 
Persia— Silver. 


APPENDIX. 


625 


Peru — Silver.     Actual  currency  depreciated  paper. 

Portugal — Gold . 

ROUMANIA — Gold. 

Russia — Gold.     Actual  currency  depreciated  paper. 

Scandinavian  Union  (Sweden,  Norway,  and  Denmark) — Gold. 

Servia — Assimilated  to  Latin  Union — Gold  and  silver, 

SiAM — Silver. 

Spain — Same  as  Latin  Union.     Actual  currency  depreciated  paper. 

Switzerland — See  Latin  Union. 

Turkey — Gold  and  silver.     Silver  not  coined. 

United  States — Gold  and  silver.     Silver  not  coined. 

Venezuela— Silver. 


APPROXIMATE  STOCKS  OF  MONEY  IN  THE  WORLD. 
From   the  Report  of   the  Director   of    the  Mint  for   1898. 


Population 

Gold. 

Silver. 

Uncovered 
paper. 

Per  capita. 

Countries. 

Gold 

Silver 

Paper 

Total 

United  States 

United  Kingdom 

74,500,000 
39,800,000 
38,500,000 
52,300,000 
6,500,000 
31,300,000 
3,000,000 
2,400,000 
18,000,000 
5,100,000 
5,400,000 
2,300,000 
45,400,000 
4,900,000 
2,000,000 
5,000,000 
2,300,000 
129,200,000 
24,100,000 
5,000,000 
9,700,000 
13,000,000 
3,300,000 
37,500,000 
45,000,000 
296,900,000 
383,300,000 
3,900,000 
5,300,000 
1,800,000 
1,000,000 
3,300,000 
5,000,000 
100,000 
1,800,000 
900.000 
2,600,000 

$925,100,000 

438,000,000 

810,600,000 

668,500,000 

30,000,000 

96,500,000 

24,000,000 

500,000 

45,500,000 

5,200,000 

14,500,000 

1,200,000 

227.700,000 

21,900,000 

7,800,000 

8,600,000 

15,300,000 

756,600,000 

50,000,000 

132,100,000 

30,000,000 

8,600,000 

1,300,000 

77,500,000 

79,900,000 

$638,200,000 

121,700,000 

419,800,000 

212,800,000 

45,000,000 

42,500,000 

10,700,000 

1,500,000 

49,800,000 

6,100,000 

10,000,000 

2,700,000 

145,500,006 

56,100,000 

2,300,009 

5,700,000 

5,400,000 

128,400,000 

40,000,000 

7,000,000 

6,400,000 

106,000.000 

19,000,000 

35,000,000 

60,400,000 

592,100,000 

750,000,000 

242,000,000 

5,000,000 

1,500,000 

4,500,000 

6,800,000 

193,400,000 

1,000,000 

1,000,000 

1,200.000 

400,000 

$326,100,000 
112,000,000 
124,600,000 
132,200,000 
79,100.000 
169,500,000 
14,300,000 
30,600  000 
137,500,000 
39,000,000 
33,700,000 
2,700,000 
86,200,000 
45,500,000 
3,800,000 
27,700,000 
7,000,000 

$12.42 
11.01 
21.06 
12.78 
4.62 
3.08 
8.00 

2^53 
1.02 
2.69 
.52 
5.02 
4.47 
3.90 
1.72 
6.95 
5.86 
2.07 
26.42 
3.09 
.67 
.39 
2.07 
1.77 

$8.56 
3.06 
10.90 
4.07 
6.92 

kS 

.62 
2.76 
1.20 
1.96 
1.17 
3.20 
11.45 
1.15 
1.14 
2.35 

.99 
1.66 
1.40 

.66 
8.15 
5.76 

.93 
1.34 
1.99 
1.96 
62.05 

.95 

.83 
4.50 
2.06 
38.68 
10.00 

.55 
1.33 

.15 

$4.38 
2.81 
3.23 
2.53 

12.17 
5.41 
4.77 

12.75 
7.64 
7.64 
6.24 
1.17 
1.90 
9.28 
1.90 
5.54 
3.04 

"'4.50 

"■3.07 
2.54 
20.01 

$25.26 
16.88 
35.19 

Belgium 

23.71 

Italy 

9.85 

Switzerland 

Greece 

16.33 
13.58 

Spain 

Portugal 

12.93 
9.86 

10.  S9 

Servia 

2.86 

Austria-Hungary 

Netherlands 

Norway       

10.12 
25.22 
6.95 

8.49 

12.09 

6.81 

Turkey 

""22^560,006 

3.71 

32.39 

Egypt 

3  76 

*4,000,000 

8,400,000 

750,600,000 

11.85 

Central  America 
South  America.. 

8.66 
23.00 
3.15 

117,300,000 

.40 

2.30 

1.94 

62.05 

Canada 

16,000,000 
2,000,000 
4,000,000 
1,000,000 

20,000,000 
4,000,000 

37,500,000 

29,200,000 
4, .300,000 

35,000,000 

3.01 
1.11 
4.00 
.30 
4.00 
40.00 
20.83 
32.44 
1.65 

6.60 

"■^Vio 

10.53 

Cuba  .  . 

1.94 

Haiti 

4,100,000 

12.«) 

Bulgaria 

2.36 



42.68 

60.00 

Cape  Colony 

South  Africa 

21.38 

■■3.62 

33.77 

Finland 

9,406,006 

5.42 

*  Evidently  an  error  here  or  in  per  capita  column. 

8.     THE  COURSE  OF  PRICES  AND  WAGES. 

The  table  below  shows  the  comparison  for  53  years  between  wages  and  prices 
in  the  United  States.  The  figures  are  compiled  from  the  results  of  the  special 
Senate  committee  investigation,  transmitted  to  the  Senate  March  3,  1893.   -The. 

40 


626 


APPENDIX. 


investigation  was  made  by  a  sub-committee  on  tariff,  with  Nelson  W.  Aldrich 
as  chairman. 

The  comparative  percentages  on  prices  are  based  on  quotations  of  wholesale 
prices  of  223  articles,  covering  the  period  from  1860  to  1892,  and  of  85  articles 
covering  the  whole  period  from  1840.  In  most  cases  these  were  actual  prices 
paid  during  the  month  of  January,  and  not  average  prices  for  the  year.  In  a 
few  instances,  when  the  January  price  is  not  the  typical  price  for  the  year,  the 
quotations  for  another  month  are  taken;  potatoes,  for  example,  being  quoted 
for  October.  All  these  quotations  of  the  223  articles  were  reduced  to  relative 
percentages  with  1860  as  100. 

It  would  be  manifestly  unfair  to  give  equal  weight  to  all  the  quotations  and 
strike  a  general  average  for  each  year,  so  the  attempt  was  made  to  give  each 
quotation  the  weight  it  would  have  in  the  expenditures  of  the  average  family. 
The  basis  taken  was  the  investigations  of  the  Commissioner  of  Labor  as  reported 
in  the  seventh  annual  report  (1891),  in  which  the  average  expenditures  of  2,561 
normal  families  are  found  to  be  as  follows: 

Kent,  15.06  per  cent;  food,  41.03;  fuel,  5.00;  clothing,  15.31;  light,  0.90;  all 
other  purposes,  22.70;  total,  100.00  per  cent.  The  articles  included  in  table  of 
prices  constitute  68.60  per  cent  of  the  expenditures  of  an  average  family, 

RELATIVE  PRICES  AND  WAGES  IN  CURRENCY,  GOLD  AND  SILVER.-1840  TO  1892. 
[All  figures  are  in  percentages,  with  the  year  1860  as  100.] 


I 


■  Relative  Prices  in— 

Relative  Wages  m— 

Combined 

Prices  and 

Wages. 

Year. 

Cur- 
rency. 

Gold. 

Silver. 

Cur- 
rency. 

Gold. 

Silver. 

Gold. 

1840 

1841 

1842  . 

97.7 
98.1 
90.1 
84.3 
85.0 

88.2 
95.2 
95.2 
88.3 
83.5 

89.2 
98.6 
97.9 
105.0 
105.0 

109.2 
112.3 
114.0 
113.2 
102.9 

100.0 

95.4 
95.8 
89.1 
83.7 

84.5 

87.8 
94.8 
93.2 
88.0 
82.6 

88.1 
94.4 
93.7 
100.9 
100.5 

104.6 
108.5 
108.0 
108.6 
98.4 

94.9 
90.5 

82.5 
79.9 
84.1 
83.0 
83.2 

85.7 
89.1 
91.3 
91.6 
90.5 

90.9 
91.1 
91.8 
93.2 
95.8 

97.5 
98.0 
99.2 
97.9 
99.7 

100.0 

80.6 
78.6 
83.2 
82.5 
82.7 

85.3 
88.7 
89.4 
91.3 
89.4 

89.8 
87.2 
87.9 
89.6 
91.7 

93.4 
94.7 
94.0 
93.9 
95.0 

94.9 
96.9 

90.1 

89. 

86.6 

1843       

83.6 

1844 

84.1 

1845    ..     .. 

86.9 

1846 

92.1 

1847 

93.2 

1848 

89.9 

1849 

87.0 

1850 

90.1 

1851 

94.8 

1852 

94.8 

1853 

99.1 

1854 

100.4 

1855 

103.3 

1856 

105.1 

1857 

1858 

106.6 
105.5 

1859 

101.3 

1860 

100. 

1861 

9^ 

LI 

100 

.7 

97.4 

APPENDIX. 


G27 


RELATIVE    PRICES  AND  WAGES  IX   CURRENCY.    (Continued.) 


Year. 
January. 


Relative  Prices  in — 


Cur- 
rency. 


Gold. 


Relative  Wages  in- 


Combined 

Prices  and 

Wages. 


1862.. 
1863.. 
1864.. 

1865.. 
1866.. 
1867.. 
1868.. 
1869.. 


1870.. 
1871.. 
1872.. 
1873.. 
1874.. 

1875.. 
1876.. 
1877.. 
1878.. 
1879.. 

1880.. 
1881.. 
1882.. 
1883.. 
1884.. 


1885., 
1886.. 

1887., 
1888.. 
1889., 


1890 

1891 

1891,  Oct. 

1892,  Oct. 


104.1 
132.2 
172.1 

232.2 
187.7 
165.8 
173.9 
152.3 

144.4 
136.1 
132.4 
129.0 
129.9 

128.9 
122.6 
113.6 
104.6 


101.6 
91.1 
110.7 

107.4 
134.0 
123  2 
125  6 
112.3 

119.0 
122.9 
121.4 
114.5 
116.6 

114.6 
108.7 
107.0 
103.2 


95.0 

104.9 
108.4 
109.1 
106.6 
102.6 

93.3 
93.4 
94.5 
96.2 
98.5 

93.7 
94.4 
92.8 
91.7 


1840-49 
1850-59 
1860-69 
1879-79 
1880-89 


90.6 

104.7 
151.4   I   110.0 
123.7   I  112.3 

100.8 


90.8 
87.1 
105.0 

102.9 
128.4 
119.4 
122.2 
109!o 

115.8 
119.7 
117.6 
111.0 
117.1 

117.4 
115.5 
109.6 
113.4 
111.4 

117.9 
124.7 
123.8 
125.0 
119.0 

110.8 
117.9 
119.0 
127  9 
136.6 

124.2 
116.1 
122.8 
138.9 


89.5 
100.6 
105.0 
114.9 
122.3 


103.7 
118.8 
134.0 

148.6 
155.6 
164.0 
164.9 
167.4 

167.1 
166.4 
167.1 
166.1 
162.5 

158.0 
151.4 
14.3.8 
140.9 
139 


101.2 
81.9 
86.2 


111.1 
121.8 
119.1 
123.5 

136.9 
150.3 
153.2 
147.4 
145.9 

140.4 
134.2 
135.4 
139.0 

4 


143.0 
150.7 
152.9 
159.2 
155.1 

155.9 
155.8 
156.6 
157.9 
162.9 

168.2 
168.6 
168.4 
166.0 


86.1 

95.5 
135.8  I  101.4 
156.3  1  142.2 
155.0 


97.4 
78.3 
81.8 

65.8 
106.4 
118.0 
115.9 
119.9 

133.2 
146.4 
148.4 
142.9 
146.5 

143.9 
142.6 
138.7 
155.2 
163.4 

160.7 
173.3 
173  5 
186.8 
179.8 

185.0 
196.6 
197.2 
209.9 
225.8 

222,9 
207.4 
215.9 
251.4 


85.2 
91.7 
97.5 
145.9 
188.9 


101.4 
86.5 
98.4 

88.0 
122.5 
122.5 
122.3 
117.9 

127.9 
136.6 
137.3 
130.9 
131.2 

127.5 
121.4 
122.2 
121.1 
117.2 

123.9 
129.5 
131.0 
132.9 
128.8 

129.6 
124.6 
125.5 
127.0 
130.7 

130.9 
131.5 
130.6 

128.8 


88.3 
100.1 
105.7 
127.2 
127.9 


In  the  foregoing  table  the  effect  of  an  inflated  paper  currency  is  shown  by 
the  currency  prices  from  1862  to  1878. 

The  course  of  prices  and  wages  will  be  more  readily  seen  by  constructing 
diagrams  from  the  figures  of  the  foregoing  table,  omitting  the  currency  column, 
as  of  no  pressing  interest  at  the  present  time.  Diagram  IV.  (page  629), 
shows  the  gold  prices  ;  diagram  V.  (page  629),  the  silver  prices  ;  diagram  VI. 


628 


APPENDIX. 


rnao-e  630),  ffold  wages  ;*  and  diagram  VII.  (page  631),  gold  wages  and  gold 
pric^es  combined.  Diagram  VIII.  (page  632),  shows  the  course  of  the  price  of 
silver  as  a  commodity,  as  compared  with  English  gold  prices  of  commodities 
by  Sauerbeck's  tables.  .     .  xv        •         ^      i,  . 

In  considering  the  question  of  wages,  the  important  thing  is  not  what 
money  is  received,  but  what  comforts  the  day's  labor  will  procure.  I  find  the 
following  table  in  Waldrnn's  Handbook,  evidently  computed  from  the  Aldnch 
Report.  Diagram  IX  (page  633),  which  follows,  is  prepared  from 
column  showing  the  relative  purchasing  power  of  ten  hours'  labor, 

PURCHASING   POWER  OF  A  DAY'S  LABOR. 
[All  figures  are  in  percentages,  with  the  year  1860  as  100.] 


the 


Year. 

^2 

J! 

1!.  1 
ill 

Year. 

^11 

o 

1! 

hi 

January. 

III 

II 

January. 

li 

1840 

84.4 

11.4 

74.0 

1870 

115.7 

10.5 

110.2 

1841 

81.4 

11.5 

70.8 

1871 

122.3 

10.5 

116.5 

1842    

93.3 

11.4 

81.8 

1872 

126.2 

10.5 

120.2 

1843 

98.5 

11.5 

85.7 

1873 

128.8 

10.5 

122.7 

1844 

97.9 

11.6 

84.7 

1874 

125.1 

10.5 

119.1 

1845 

97.2 

11.5 

84.5 

1875 

122.6 

10.3 

119.0 

1846 

93  6 

11.4 

82.1 

1876 

123.5 

10.3 

119.9 

1847 

85  9 

11.5 

83.4 

1877 

126.6 

10.3 

122.9 

1848 

103.8 

11.3 

91.9 

1878 

134.7 

10.3 

130.8 

1849 

108.4 

11.2 

92.7 

1879 

146.7 

10.3 

142.4 

1850 

101.6 

11.5 

88.6 

1880 

136.3 

10.3 

132.3 

1851 

92.4 

11.4 

81.1 

1881 

139.0 

10.3 

135.0 

1852 

93.8 

11.2 

83.8 

1882 

140.2 

10.3 

136.1 

1853 

88.8 

11.3 

78.6 

1883 

149.3 

10.3 

145.0 

1854 

91.2 

11.1 

82.2 

1884 

151.2 

10.3 

146.2 

1855 

89.3 

11.1 

80.5 

1885 

167.1 

10.3 

162.2 

1856  

87.3 

11.0 

79.8 

1886 

166.8 

10.2 

163.5 

1857 

87.0 

10.9 

79.8 

1887 

165.7 

10.0 

165.7 

1858    

86.5 

11.0 

78.6 

1888 

164.1 

10.0 

164.1 

1859 

96.9 

11.1 

87.3 

1889 

165.3 

10.0 

165.3 

I860 

100.0 

11.0 

90.9 

1890 

179.5 

10.0 

179.5 

1861 

107.0 

10.9 

98.2 

1891 

178.6 

10.0 

178.6 

1862 

96  6 

10.8 

92.2 

1891,  Oct. 

181.5 

10.0 

181.5 

1863 

89.9 

10.8 

83.2 

1892,  Oct. 

181.0 

10.0 

181.0 

1864 

77.9 

10.8 

72.1 

1840-49... 

95.4 

11.4 

83.2 

1865 

64.0 

10.7 

59.8 

1850-59... 

91.5 

11.3 

82.0 

1866 

82.9 

10.8 

76.8 

1860-69... 

92.5 

10.8 

85.8 

1867  

98.6 

10.8 

91.3 

1870-79... 

127.2 

10.4 

122.4 

1868 

94.8 

10.6 

89.4 

1880-89... 

154.5 

10.2 

151.5 

1869 

109.9 

10.6 

103.7 

1890-92.. 

180.2 

10.0 

180.2 

*  Diagra 
Interest  er 
the  change 

ms  VI.  and 
edited  to  th 
from  the  ci 

VII.  ar 

e  Aldric 
irrcncy 

0  prepared 
h  Report,  bi 
prices  giver 

from  tables 
It  Professor  F 
1  in  the  Repo 

In  Fisher's 
i.sher  seem 
rt,  and  I  fo 

Appre 

to  hav 

How  hi 

^iation  and 

e  computed 

figures.     I 

I'^rcTangefrom^hec^irr^ncy  n^^^^^^^^  follow  his  figures.     I 

have  prepared  from  these  taV)les  the  diagram  for   combined  wages  and  prices,  by 
adding  prices  and  wages  and  dividing  by  two. 


i 


APPENDIX. 


029 


§       a 


630 


APPENDIX. 


o        o         o        o 


S       8      g 


APPENDIX. 


C31 


I         I 


a 

o 


5   o 


Di^I  I 


^1  i 


632 


APPENDIX. 


633 


634 


ArPENDIX. 


It  is  interesting  to  compare  the  course  of  prices  of  farm  products  with  that 
of  wages.  The  Aldrich  Report  segregates  the  prices  of  farm  products,  but  com- 
putes the  index  numbers  only  from  1860.  Waldron's  Handbook  contains  a 
table,  credited  to  the  Voice,  computed  in  a  manner  similar  to  that  of  the  Al- 
drich Report,  but  which  gives  index  numbers  from  1840.  It  is  based  on  the 
wholesale  prices  in  New  York  City  and  is  given  below.  Diagram  X.  (page 
635),  is  prepared  from  the  column  of  gold  prices. 

RELATIVE   COMBINED  AVERAGE  OF  NINE  FARM   PRODUCTS.* 


1 

Prices  in 

Calendar  Year. 

Prices  in 

Calendar  Year. 

5 

2 

o 

1 

a 
t 

O 

2 

o 

HE 

1840 

76.2 
83.5 
73.8 
68.5 
66.3 

67.5 
78.8 
98.5 
77.8 
82.4 

88.9 
85.1 
87.7 
98.1 
106.8 

118.9 
103.9 
117.5 
103.8 
107.1 

100.0 
99  0 

74.4 
82.0 
73.2 
68.3 
65.7 

67.2 
78.4 
97.3 
77.1 
81.3 

87.3 
82.3 
85.5 
94.1 
102.5 

114.4 
100.0 
112.2 
99.9 
101.8 

95.6 
96.0 
116.6 
148.2 
158.5 

149.7 
130.3 
122.6 
122.7 
120.1 

122.0 

1871  

121.4 
116.5 
112.5 
121.7 

119.9 
97.0 
99.5 
80.3 

108.7 

103.7 

98.9 

109.4 

104.2 
86.9 
95.0 
79.6 

106.0 

1841 

1872 

101.4 

1842 

1873 

1874 

1875 

98.4 

1843  

110.7 

1844 

108.1 

1845 

1846 

1876   

97.3 

1877 

102.2 

1847 

1878 

89.5 

1848  

1849 

1879      

77.6 

86.3 
97.1 
113.2 
99.5 
92.0 

80.8 
78.6 
80.4 
87.6 
75.3 

77.1 
88.8 
77.6 
84.6 
76.6 

88.3 

1880      

97.4 

1850 

1881 

110.3 

1851 

1882 

128.9 

1852 

1853 

1883 

115.9 

1884 

106.9 

1854  

1885 

1886 

98.1 
102.2 

1855 

1856 

1887 

106.3 

1857 

1888 

1889 

120.5 

1858 

106.5 

1859 

1890 

1891 

1892 

95.2 
116.2 

1860 

1861 

115.2 

1862 

137.6 
223.8 
335.1 

243.7 
190.2 
175.3 
17.5.9 
163.7 

144.0 

121.5 
154.2 
164.9 

155  0 
135.0 
126.9 
125  9 
123.1 

125  3 

1893 

140.4 

1863 

1894 

156.4 

1864 

1865 

1840-49 

77.3 

101.8 

184.4  130.6 

109.0   98.9 

76.5 

i850  59 

1867 

99.0 

,1860-69 

1870-79 

1880-89 

1890-94 

126.2 

1868 

1869 

102.3 

1870 

89.1 
80.9 

109.3 
124.7 

*  Wheat,  rye,  oats,  corn,  uplan<l  cotton,  retinins  sugar,  Kentucky  loaf  tobacco,  fresh 
beef  and  fresh  jiork. 


APTENDIX. 


G3r 


G36 


APPENDIX. 


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APPENDIX. 


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8 


638  APPENDIX. 

The  United  States  Department  of  Agriculture  has  computed,  since  1862,  the 
home  prices  of  a  number  of  farm  products,  which  it  is  interesting  to  compare 
with  the  course  of  New  York  prices  of  farm  products,  although  the  products 
are  not  identical.  The  table  on  page  636  gives  the  home  value  per  bushel, 
ton,  or  pound  of  ten  of  these  leading  crops.  The  three  right  hand  columns  of 
the  table  show  the  ratio  of  the  prices  of  the  combined  products  in  currency, 
gold,  and  silver.  The  currency  ratio  is  obtained  by  dividing  the  total  value  of 
these  products  by  the  total  quantity  in  a  certain  fixed  proportion  for  eacji  of 
the  ten  products.  From  this  the  gold  and  silver  prices  are  computed.  Diagram 
XI  (page  637)  is  prepared  from  the  column  of  gold  prices.  This  proportion, 
in  the  form  of  "quantity  units  "  in  the  table,  is  as  follows: — 

Corn,  250  bushels;  wheat,  125  bushels;  oats  3331  bushels;  barley,  rye, 
buckwheat,  each  ]66|  bushels;  potatoes,  200  bushels;  hay,  10  tons;  cotton, 
1,000  pounds;  tobacco,  1,250  pounds. 

These  quantities  were  chosen  because,  at  the  average  values  of  these  pro- 
ducts for  the  past  thirty  years,  the  same  amount  of  money  would  purchase  each 
of  the  products  in  the  proportion  given.  Por  example,  two  bushels  of  corn  are 
found  to  be  equivalent  to  one  bushel  of  wheat,  and  two"  bushels  of  barley,  rye, 
or  buckwheat  to  one  of  oats,  etc. 

The  ratio  of  prices  is  computed  by  dividing,  in  each  year  the  total  value  of 
the  products  by  the  number  of  quantity  units  computed  as  above,  and  the 
numbers  are  not,  therefore,  percentages  of  the  prices  in  a  selected  year.  They 
show  the  course  of  prices,  but  are  not  otherwise  comparable  with  the  preceding 
tables. 

All  the  above  tables  and  diagrams  except  Diagram  VIII.  refer  to  the  United 
States.  It  would  be  interesting  to  make  an  exact  comparison  with  prices  of  the 
same  commodities  during  the  same  period,  in  Europe.  There  are,  however,  no 
data  for  this.  The  commodities  in  the  Sauerbeck,  Economist  and  Soetbeer 
tables  do  not  coincide  with  those  in  the  Aldrich  tables,  the  periods  covered  are 
not  altogether  the  same,  and  the  years  taken  as  the  base  lines  for  comparison 
differ.  This  last  difficulty  was  met  by  the  statistician  of  the  Aldrich  Committee, 
by  transposing  the  figures  of  the  foreign  tables  so  as  to  make  the  year  1860  the 
basis  of  comparison,  as  in  the  United  States.  In  constructing  the  diagrams 
the  figures  of  the  transposed  tables  have  been  used,  but  for  convenience  of 
reference  the  tables  themselves  give  both  the  original  and  the  transposed  figures. 
The  original  figures  of  all  these  tables  are  of  course  those  usually  quoted.  In 
all  these  European  tables  the  index  numbers  are  obtained  by  dividing  the 
table  of  prices  by  the  number  of  articles,  thus  giving  to  each  article  the  same 
weight,  whether  of  every  day  use  in  great  quantity,  like  wheat,  or  of  compara- 
tively small  importance  like  indigo.  In  this,  also,  as  already  explained,  they 
differ  from  the  Aldrich  tables  which  are  prepared  in  such  a  form  as  to  give 
to  each  article  its  relative  importance  in  family  purchases.  The  Aldrich 
tables  of  wages  are  also  "weighted  "  by  giving  the  wages  paid  in  each  industry 
a  relative  importance  in  accordance  with  the  number  of  persons  employed 
in  it. 


APPENDIX. 


ECONOMIST   INUKX   NUMK?:RS   OF   PRICES. 

Average  Prices  of  22  Co7mnodities,  1S4>5  to  1850=100.     The  right-hand  column 
gives  the  figures  as  transposed  to  make  the  year  1860  the  basis  of  comparison. 


Year. 

INAL. 

e  prices 
to  1851, 

As  transposed 
by  Aldricli 
committee. 

Price  of  1860 
=100. 

Year. 

d!. 

As  transposed 
by  Aldrich 
committee. 

Price  of  1860, 
=  100. 

Orig 

Averag 

of  1845 

100. 

5  £3  II 
<   o 

1851 

104 

1875 

126 

103.9 

1852 

93 
108 
122 
118 
123 
182 
119 
115 

1876 

1877 

1878 

1879 

1880 

1881 

1882 

1883 

123 
128 
115 
101 
115 
108 
111 
106 

102.4 
101.5 
94.1 
80.7 
92.2 
86.1 
88.4 
84.6 

1853 

1854 

1855 

1856 

1857 

1858 

1859 

100 

1860 

121 

102 

1884 

101 

82.5 

1861 

124 

109 

1885 

05 

77.3 

1862 

181 

135.9 

1886 

92 

73.3 

1863 

159 

144.8 

1887 

94 

75.3 

1864 

172 

135  5 

1888 

101 

80.0 

1865 

168 

133.0 

1889 

99 

79.6 

1866 

162 

115.3 

1890 

102 

82.8 

1867 

137 

99.3 

1891 

102 

81.0 

1868 

122 

105  0 

1892 

97 

78.0 

1869 

121 

105.5 

1893 

96 

76.7 

1870 

122 

100.8 

1894 

87.4* 

72.2 

1871 

118 

108.8 

1895 

89.3 

73.8 

1872 

129 

114.6 

1896 

89 

73.6 

1873 

184 

110.2 

1897 

86.5 

71.4 

1874 

181 

103.9 

|1898 

86.6 

71.4 

_ 

See  Diagram  XII.  (page  640.) 


*For  December,  1894.  The  Aldrich  Report  contains  the  Economist  Index  numbers 
to  1893.  In  seeking  to  continue  them  to  date,  I  have  been  unable  to  find  a  set  of  the 
Economist  in  San  Francisco.  A  student  in  Stanford  Univer.«ity  has  been  able  to 
supply  me  with  the  totals  of  Economist  prices  for  the  end  of  each  quarter  of 
1895, 1896,  }897,  and  1898,  of  which  I  have  taken  the  average  from  which  to  compute  the 
annual  index  number,  although  I  infer  from  an  expression  in  the  Aldrich  Report  that 
the  number  usually  quoted  as  the  Economist  number  is  that  of  January  in  each  year.  For 
1894  my  data  includes  only  the  quotation  for  December,  which  I  have,  therefore,  taken. 
I  have  transposed  the  index  numbers  of  these  years  to  the  basis  of  1860,  by  dividing 
each  by  the  index  numbers  for  1860.  The  result  is  in  any  case  sufficiently  accurate  for 
the  purposes  of  this  book,  but  this  explanation  is  given  for  the  benefit  of  students  who 
may  have  occasion  to  refer  to  these  tables. 


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APPENDIX. 


641 


TABLES  OF   DR.   A.  SAUERBECK. 


Relative  Prices  of  45  Commodities  in  England,  1846  to  1S98.      Original  and  as 
transposed  by  Aldrich  Committee  to  correspond  tvith  the  American  tables. 


Year. 

Original. 

Average   prices 
Of  1867  to  1877, 
=  100. 

Transposed. 

Price  of  1860, 
=100,. 

I 

Year. 

Original. 

Average   prices 
of  1867  to  1877, 
=100. 

1 

Transposed. 

Price  of  1860, 
=100.* 

1846 

89 

92.2 

1873 

Ill 

116.6 

1847 

95 

97.9 

1874 

102 

107.0 

1848 

78 

79.9 

1875 

96 

100.3 

1849 

74 

76.4 

1876 

95 

97.5 

1850 

77 

79.0 

1877 

94 

97.4 

1851 

75 

77.1 

1878 

87 

91.2 

1852 

78  • 
95 

80.8 
96.9 

1879 

83 
88 

86.7 

1853 

1880 

91.8 

1854 

102 

106.2 

1881 

85 

88.5 

1855 

101 

103.1 

1882 

84 

88.0 

1856 

101 

102.8 

1883 

82 

86.0 

1857 

105 

106.9 

1884 

76 

79.8 

1858 

91 

93.3    , 

1885 

72 

75.4 

1859 

94 
99 
98 

95.2    1 
100.0 
99.6    1 

1880 

69 
68 
70 

72.4 

1860 

1887 

70.7 

1861 

1888 

73.9 

1862 

101 

105.5 

1889 

72 

76.7 

1863 

103 

109.3 

1890 

72 

76.0 

1864 

105 

112.3 

1891 

72 

75.4 

1865 

101 

105  8 

1892  

68 

68.6 

1866 

102 

106.5 

1893 

68 

68.6 

1867 

100 

103.9 

1894 

63 

63.6 

1868 

99 

103.1 

1895 

62 

62.6 

1869 

98 

101.9 

1896 

61 

61.6 

1870 

96 
100 
109 

100.3 
102.6 
112.5 

1897 

62 
64 

62.6 

1871 

1898 

64.6 

1872 

See  Diagram  XIII.  (page  642). 

*The  transposition  of  Senate  Committee  ends  with  1891.    From  that  year  it  is  con- 
tinued by  the  author  by  dividing  the  price  of  each  year  by  the  price  of  1860. 


41 


642 


APPENDIX. 


CO 


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g      «  o 


I 


i 


APPENDIX. 


G13 


TABLES  OF  DR.  A.  SOETBEEK. 

Relative  Prices  of  100  Leading  Articles  in  Hamburg,  and  14  articles  of  British 
export^  original,  and  as  transposed  by  Aldrich  Committee  to  correspond  with 
American  tables. 


Year. 

Original. 

Average  prices, 
1847    to    1850, 
=  100. 

Transposed. 

Prices  of  1860, 
=  100. 

Year. 

Original. 

Average  prices, 
1847    to    1850, 
=  100. 

Transposed. 

Prices  of  1860. 
=  100. 

1851 

100.21 
101.69 
113.69 
121.25 
124.23 
123.27 
130.11 
113.52 
116.34 
120.98 
118.10 
122.65 
125.49 
129.28 
122.63 
125.85 
124.44 
121.99 
123.38 
122.87 
127.03 

82.8 

84.1 

94.0 

100.2 

102.7 

101.9 

107.5 

98.8 

96.2 

100.0 

97.6 

101.4 

103.7 

io«;.9 

101.4 
104.0 
102.9 
100.8 
102.0 
101.6 
105.0 

1872 

135.62 
138.28 
136.20 
129.85 
128.33 
127.70 
120.00 
117.10 
121.89 
121.07 
122.14 
122.24 
114.25 
108.72 
103.99 
102.02 
102.04 
106.13 
108.13 
109.19 

112  1 

1852 

1873 

114  3 

1853 

1874 

112  6 

1854 

,  1875  

107  3 

1855. 

1876  .. 

106  1 

1856 

1877 

105.6 

1857 

1878 

99.7 

1858 

1879 

96.8 

1859 

1880 

100  8 

1860 

1881 

100.1 

1861 

1862 

1882 

1883 

101.0 
101  0 

1863 

1884 

94  4 

1864 

1865 

1885 

1886 

89.9 
86  0 

1866 

1887 

84  8 

1867 

1888 

84  3 

1868 

1889 

87  7 

1869.. 

1890  

89.4 

1870 

1891 

90.0 

1871 

See  Diagram  XH'.  (page  642). 

The  course  of  silver  as  compared  with  commodities  has  been  shown  in 
diagram  V.  in  which  it  is  seen  that  according  to  the  computations  of  Dr. 
Sauerbeck  it  follows  commodity  prices  quite  closely.  In  that  diagram  silver  is 
simply  considered  as  one  commodity  compared  as  to  price,  with  the  average  of 
forty-five  other  commodities  in  England,  a  country  of  gold  standard.  It 
would  be  interesting  to  compare  with  the  gold  prices,  heretofore  given,  the 
course  of  silver  pi'ices  in  countries  with  the  silver  standard.  Unfortunately  the 
data  for  this  are  very  meager.  Mr.  F.  J.  Atkinson  has  made  a  laborious  cal- 
culation of  the  course  of  silver  prices  in  India,  which  is  to  be  found  in  the 
Journal  of  the  Royal  Statistical  Society  for  1897,  and  extends  from  1861  to  1895. 
I  also  find  upon  page  463  of  a  U.  S.  Senate  Document  entitled  "Coinage  Laws 
of  the  United  States"  (Government  Printing  Office,  1894)  a  table  of  index 
numbers  of  prices  of  twenty  Chinese  staple  commodities  from  1873  to  1892,  and 
printed  without  comment.  So  far  as  I  know  there  are  no  other  data  covering 
this  branch  of  the  inquiry.  As  will  be  seen  below  they  hardly  agree  at  any 
point.  The  calculations  of  Mr.  Atkinson,  given  in  full  in  the  place  of  original 
publication,  give  evidence  of  a  great  amount  of  labor  intelligently  applied,  but 
for  reasons  fully  set  forth  by  Mr.  Atkinson,  do  not  throw  much  light  upon  the 


644 


APPENDIX. 


problem  of  the  probable  result  of  the  use  of  a  silver  standard,  as  conditions  in 
India  are  abnormal.  An  index  table  constructed  upon  silver  prices  in  China 
would  have  much  greater  promise  of  value,  but  I  have  no  knowledge  of  the 
methods  employed  by  Mr.  Wetmore.  I  assume  his  competence  from  the  fact 
that  his  table  is  included  in  a  public  document  whose  compilers  must  have 
been  familiar  with  the  facts. 

The  two  tables  with  the  diagrams  prepared  from  them  are  as  follows  and 
are  given  for  what  they  are  worth: — 

RELATIVE   SILVER  PRICES  IN   INDIA. 
Table  of  Index  Nionbers,  prepared  from  his  oivtt  calcidations,  by  F.J.  Atkinson, 
Journal  Royal  Statistical  Society,  1897. 

Prices  of  1871  =  100. 


1861  ... 

1862  ... 

99 

99 

1870  .... 

1871  .... 

1872  .... 

1873  f... 

1874  .... 

1875  .... 

1876  .... 

1877  .... 

1878  .... 

..  115 
..  100 
..  105 
..  107 
..  116 
..  103 
..  107 
..  138 
..  148 

1879  ... 

1880  ... 

1881  ... 

1882  ... 

1883  ... 

1884  ... 

1885  ... 

1886  ... 

1887  ... 

...  135 
...  117 

...  106 
...  105 
...  106 
...  114 
...  113 
...  110 
...  Ill 

1888  ... 

1889  ... 

1890  ... 

1891  ... 

1892  ... 

1893  ... 

1894  ... 

1895  ... 

...  119 
...  125 

1863  ... 

1864  . 

104 

112 

...  125 
...  128 

1865  ... 

1866  ... 
1867 

117 

133 

.  ..  126 

...  141 
...  138 
...  131 

1868  .... 

1869  ... 

114 

126 

...  128 

occ  Diagram  XV.  (page  645). 

According  to  the   foregoing   table,  silver  prices  of  commodities  in   India 
fluctuated  violently  and  were  28  per  cent  higher  in  1895  than  in  1871. 

RELATIVE  SILVER  PRICES  IN  CHINA. 
Table  of  Index  Numbers  compiled  by  W.  S.  Wetmore  from  calculations  based  on 
the  records  of  the  hnperial  Customs  of  China. 
Prices  of  1873=100. 


1873... 

...100.0 

1877... 

...101.5 

1881... 

..  97.0 

1885... 

..  92.7 

1889  .. 

...  90.1 

1874  .. 

...  90.7 

1878  .. 

...105.1 

1882... 

..  99.3 

1886... 

..  92.9 

1890  .. 

..  90.4 

1875... 

...  89.3 

1879  .. 

...101.1 

1883... 

..  95  8 

1887... 

..  88.7 

1891... 

..  87.4 

1876... 

...  96.5 

1880... 

...  96.2 

1884... 

..  94.1 

1888  .. 

..  88.0 

1892  .. 

..  88.0 

See  Diagram  XVI.  (page  645). 

According  to  Mr.  Wetmore's  table,  silver  prices  in  China  were  quite  stable, 
and  were  twelve  per  cent  lower  in  1892  than  in  1873. 

I  am  not  able  to  throw  much  light  upon  the  question  as  to  which  of  these 
two  tables,  if  either,  indicates  the  normal  course  of  silver  with  respect  to  com- 
modities, but  taking  into  consideration  the  fact  that  local  conditions  affecting 
prices  were  more  nearly  normal  in  China  than  in  India,  and  the  general 
coincidence  pf  Mr.  Wetmore's  table  with  the  course  of  silver  and  commodities 
in  England,  as  shown  in  Diagram  V.,  I  am  compelled  to  believe  that  Mr. 
Wetmore's  table  comes  nearer  to  showing  the  probable  result  of  the  general  use 
of  the  silver  standard  than  Mr.  Atkinson's.  But  one  swallow  does  not  make  a 
summerj  and  it  must  not  be  so  imagined  in  either  case. 


API'ENDIX. 


C245 


646  APPENDIX. 

The  item  of  transportation  enters  so  largely  into  the  cost  of  products  delivered 
at  the  great  wholesale  centers  that  no  treatment  of  the  subject  of  prices — espe- 
cially from  the  farmer's  standpoint — is  complete  without  a  consideration  of  the 
relative  prices  of  transportation.  Unfortunately  the  data  upon  this  subject,  for 
the  earlier  part  of  the  period  covered  by  the  foregoing  tables,  are  very  meagre, 
as  to  railroad  transportation,  and  I  have  found  no  statistics,  whatever,  covering 
transportation  by  sea  or  inland  waters.  The  statistician  of  the  Interstate  Com- 
merce Commission  supplied  to  the  Aldrich  Committee  all  the  data  relating  to 
early  freight  tariffs  which  could  be  gathered  by  that  office.  Since  the  creation  of 
the  Interstate  Commerce  Commission  the  data  are  ample,  but  no  one,  that  I  am 
aware  of,  has  summarized  the  facts  and  constructed  an  index  table  or  other 
device  to  show  the  course  of  cost  of  transportation.  The  most  convenient 
method  of  showing  relative  freight  rates  is  by  a  comparison  of  the  average  rates 
per  ton  per  mile.  The  information  on  this  point  which  was  available  in  1893 
will  be  found  on  page  615  of  the  Aldrich  Report.  From  the  facts  there  given"! 
select  the  following.  While  they  apply  in  each  case,  only  to  the  railroads 
named,*  they  will  give  an  idea  of  the  decrease  in  the  cost  of  transportation 
during  the  last  quarter  of  a  century. 

AVERAGE    FREIGHT  RATES  PER    TON  PER    MILE. 

SOME    TYPICAL     CASES     SELECTED     FROM     DATA     ON    PAGE    615    OF    THE    REPORT 
OF    THE   ALDRICH     COMMITTEE. 

Average  rate  per  ton  per  mile. 

Cts.  Cts. 

Fitchburg  Railroad 1852  3.12  .  1892  .925 

Central  Vermont  Railroad 1866  2.85     1890  .777 

New  York  &  New  England  Railroad         1886  6.40  .  1892  1.155 

New  York,  New  Haven  &  Hartford  Railroad   ....  1857  3.80  .  1892  1.756 

New  York  Central  Railroad          1855  3.02.1892  .700 

Lake  Shore  &  M.  S.  Railroad 1854  3.51  .  1892  .687 

Cleveland,  Cincinnati  &  St.  Louis 1853  3.03  ,  1892  .710 

Pennsylvania  Railroad 1852  5.42.1892  .647 

Ohio  &  Miss.  Railroad 1858  3.25  .  1892  .911 

Chicago  &  Northwestern 1868  3.13.1892  1.013 

Union  Pacific  Railroad 1872  2.34  .  1892  1.081 

Atchison,  T.  &  S.  F. 1873  3.10.1892  1.130 

The  foregoing  will  give  an  idea  of  the  reduction  in  cost  of  transportation, 
and  may  be  as  valuable  as  an  average  for  the  United  States  were  it  known. 

APPRECIATION  AND   INTEREST. 

It  is  claimed  by  some  that  while  gold  has  very  likely  appreciated,  with 
respect  to  commodities,  interest  upon  invested  capital  has  fallen  so  rapidly 
that  the  possession  of  $10,000  of  loanable  capital  will  now  bring  to  its  owner 
no  more  annual  income  than  $5,000  would  have  procured  in  1870.  The  table 
below  is  from  Professor  Fisher's  "  Appreciation  and  Interest,"  in  which,  sub- 
stantially, that  view  is  taken.  The  figures  are  doubtless  authentic  but  require 
some  explanation  for  the  reader  untrained  in  finance.  The  rates  of  interest 
quoted  are  all  upon  securities  upon  which  principal  and  interest  can  ordinarily 
be  counted  on  to  be  paid  upon  thu  day  lliey  become  due.     The  element  of  risk 


APPENDIX. 


047 


is  eliminated,  so  far  as  is  possible  in  human  aftairs.  The  column  showinfj  rates 
(per  annum)  upon  !<ixty-day  paper  represents  money  loaned  by  commercial 
banks  to  merchants,  the  money  being  mainly  the  balances  of  depositors,  and 
so  subject  to  check  at  sight.  When  business  is  lively,  interest  upon  such  loans 
tends  to  rise  by  reason  of  increased  demand,  and  in  times  of  panic,  it  tends  to 
rise  still  more,  by  reason  of  distrust  of  security  offered,  and  the  unwillingness 
of  banks  to  lend  money  whose  owners  are  likely  to  call  for  it  at  any  moment. 
This  accounts  for  the  raise  of  interest  rates  in  the  panic  years  of  1857  1873, 
and  1893. 

On  the  other  hand,  the  columns  showing  current  rates  of  interest  upon  gilt- 
edged  bonds  represents  money  intended  to  be  permanently  invested,  and,  as 
will  be  noted,  the  interest  rate  is  not  aflected  by  business  conditions. 

While  these  figures  are  doubtless  reliable  as  to  interest  rates  received  by 
capitalists  for  large  sums,  when  security  is  believed  to  be  perfect,  every  farmer 
knows  that  they  bear  no  relation  to  the  rates  which  he  has  to  pay  upon  mort- 
gage loans.  I  can  find  no  evidence  of  any  reduction  in  the  rate  of  interest 
upon  small  loans  upon  such  security  as  the  farmer  can  off"er.  The  "retail" 
price  of  money  has  not  fallen  according  to  my  observation,  but  I  know  of  no 
data  establishing  the  fact. 


INTEREST   RATES    REALIZED. 


(From  Fisher's  "Appreciation  and 

Interest.") 

Bonds. 

Money. 

Year. 

Bonds. 

Money. 

60-day 
paper 
(New 
York). 

60-dav 

Year. 

Coin. 

Cur- 
rency. 

Coin. 

Cur- 
rency. 

paper 
(New 
York). 

• 
1849 

Yearly 
Average. 

7.8 

7.2 

8.3 

7.3 
10.1 
12.5 

9.3 

9.9 
10.4 

6.7 

7  2 

1.1 

6.6 

5.4 

5.8 

8.0 

8.2 

6.3 

7.2 

7.3 

9.1 

7.2 

6.1 

8.0 
10.3 

1874 

1875 

5.0 
5.1 
4.7 
4.5 
5.0 
3.7 
3.8 
3.3 
3.0 
2.9 
2.6 

2.7  a 
2.6 
2.3 
236 
2.2 

2.1  n 
2.4  c 
2.6 

2.8  6 

2.7  <7 

2.8  h 

3.2  /) 

5.0 

4.7 

4.4 

4.4 

4.6 

4.5 

4.0 

3.4 

3.5 

3.3 

2.9 

2.7  a 

2.6 

2.6 

2.9  h 

2.6 

2.6  a 

3.0  c 
3.1 

3.1  b 
3.6  (7 
3.6 /i 
4.3  A 

Yearly 

Average. 

6.0 

1850  

6.5 

1851  

1876 

5.2 

1852 

1877 

1878 

5.2 

1853 

4.8 

1854 

1879 

5.0 

1855 

1880 

5.2 

1856 

1881 

1882 

5.2 

1857 

6.7 

1858 

1883 

5.5 

1859 

1884 

5.2 

1860 

1885 

4.1 

1861 

1886 

1887 

4.7 

1862 

5.7 

1863 

1888 

4.9 

1864 

1889 

4.8 

1865 

1890 

6.0 

1866 

1891 

1892 

6.7 

1867 

4.3 

1868 

1893 

7.1 

1869 

1894 

3.4 

1870 

6.4 
6.0 
5-3 
5.7 

5.4 
5.3 
4.9 
5.1 

1895 

3.8 

1871 

189(3 

5.8 

1872 

1897 

3.7 

1873 

1898 

1 

3.8 

648  APPENDIX. 


II.       AMERICAN    TRUSTS. 


It  is  said  that  one  day  when  the  Emperor  Nero  was  out  of  sorts,  he  expressed 
the  wish  that  all  the  Roman  people  had  but  one  neck,  so  that  he  could  the  more 
easily  cut  it  off.  Capital  seems  to  be  trying  to  put  itself  in  a  position  where  it 
can  be  similarly  dealt  with.  When  one  army  is  greatly  inferior  to  another,  its 
best  course  is  ordinarily  to  take  to  the  bush  and  carry  on  a  guerrilla  warfare. 
The  power  of  capital  is  vastly  inferior  to  that  of  the  people,  and  if  it  deliber- 
ately proposed  to  make  war  upon  the  public,  its  most  prudent  course  would  be 
to  conceal  itself,  and  fight  under  cover.  There  is  no  such  intention.  Capital  is 
not  organized  as  a  whole,  and  competes  with  itself  as  vigorously  as  farmers  or 
commission  merchants  compete  with  each  other.  Each  capitalist,  however,  is 
striving  to  make  the  most  possible  for  himself,  and  at  the  present  time  there 
appears  to  be  a  craze  among  owners  of  industrial  plants  to  unload  their  posses- 
sions, at  high  prices,  upon  the  investing  public.  They  are,  therefore,  rapidly 
organizing  Trusts  by  the  methods  described  on  page  411,  and  endeavoring  to 
sell  out.  Investors  are  allured  by  the  promise  that  as  the  result  of  the  consoli- 
dations for  which  they  are  asked  to  supply  the  capital,  prices  can  be  raised  to  a 
point  which  will  enable  the  concerns  to  pay  dividends  upon  the  enormously 
inflated  stock.  In  this  they  will  usually  fail,  and  the  investors  will  lose  their 
money.  In  its  present  shape,  therefore,  the  campaign  for  the  formation  of 
Trusts  is  a  campaign  against  investors.  The  people  can  rest  perfectly  easy.  No 
harm  can  come  to  them,  for  the  consolidation  of  interests  will  render  them 
vastly  easier  to  deal  with.  The  logical  outcome  of  a  Trust  formed  in  the  normal 
manner,  as  the  result  of  unbearable  competition,  and  with  plants  put  in  at  bed- 
rock prices,  and  in  the  absence  of  excitement,  is  profit  to  those  concerned  in  it, 
and  a  raise  in  prices  to  just  below  the  point  at  which  new  competition  will  be 
invited.  This  will  do  no  harm.  It  is  desirable  that  all  business  be  done  at  a 
reasonable  profit.  On  the  contrary,  it  may  do  good,  as  tending  to  counter 
organization  among  farmers,  working  men,  and  other  classes.  The  logical 
result  of  such  a  campaign  as  is  now  going  on  is  a  financial  panic  when  investoi-s 
shall  have  discovered  the  true  value  of  the  properties  which  they  have 
purchased.  It  is  to  be  hoped  that  it  will  not  advance  to  that  point.  The  most 
of  the  Trusts  now  forming  will  probably  not  succeed.  They  are  competing 
with  each  other  for  the  money  of  investors,  and  the  crop  of  fools,  although 
large,  is  after  all,  limited.  Some  of  the  proposed  combinations  appear  to  be 
really  consolidations  of  enormous  capital,  with  the  intent,  and  possibly,  for  the 
present,  the  power  to  oppress.  These  may  have  to  be  dealt  with,  possibly  by 
constitutional  amendment.  It  is  easy  enough  to  tax  out  of  existence  combina- 
tions of  capital  which  are  dangerous  to  society.  The  wild  laws  which  some 
legislatures  are  now  passing  can  do  no  good,  and  are  most  of  them  not  only 
unconstitutional,  but  more  injurious  to  business  than  the  evils  at  which  they 
are  aimed.  "What  the  public,  and  especially  the  farmers,  most  need,  in  order  to 
deal  successfully  with  combinations  of  capital,  is  perfectly  clear  minds  and 
perfectly  cool  heads. 

The  following  list  of  Trusts  is  compiled  from  the  San  Francisco  Chronicle 
Almanac  for  1899,   and   a  late   number  of  the   San   Francisco   Argonaut.     It 


APPENDIX. 


649 


appears  to  have  been  largely  made  up  of  items  from  press  despatches,  and  is  as 
good  as  any  other  list.  There  is  no  authentic  list  of  Trusts,  and  if  there  were, 
it  would  not  be  correct  for  a  week.  I  might  have  added  largely  to  the  list,  in 
the  way  that  I  presume  this  was  made  up,  but  it  is  not  worth  while.  The  best 
way  is  for  all  to  assume  that  every  thing  which  they  buy  is  sought  to  be  con- 
trolled by  a  Trust,  and  that  in  some  cases  the  attempt  lias  been  successful,  but 
in  many  other  cases  not. 

PARTIAL    LIST    OF    TRUSTS. 


Capital. 

Acid  trust  (forming) .f 50,000,000 

Alcohol  trust ,'),000,000 

American  corn  harvester  trust  .00,000,000 

Anglo-American  thread  trust  18,000,000 
Anthracite      coal     combine, 

Pennsylvania 85,000,000 

Asphalt  trust 3,140,000 

Ax  trust 15,000,000 

Baking  powder  trust 20,000,000 

Barbed  wire  trust,  Chicago. . .  10,000,000 

Biscuit  and  cracker  trust 12,000,000 

Bituminous  coal  trust 15,000,000 

Bleachery  combine 10,000,000 

Bolt  and  nut  trust 10,000,000 

Boiler  trust,  Pittsburg 15,000,000 

Borax  trust,  Pennsylvania. . . .  2,000,000 

Brass  trust 10,000,000 

Broom  trust,  Chicago 2,,500,000 

Brush  trust,  Ohio 2,000,000 

Buckwheat  trust 5,000,000 

Button  trust 3,000,000 

Cars  trust 60,000,000 

Carbon  candle    trust,   Cleve- 
land    3,000,000 

Carnegie  trust 25,000,000 

Cartridge  trust 10,000,000 

Cash  register  trust 10,000,000 

Casket  and  burial  goods  trust  1,000,000 

Castor  oil  trust,  St.  Louis 500,000 

Celluloid  trust 8,000,000 

Cigarette  trust.  New  York ....  25,000,000 

Clothes  wringer  trust 2,000,000 

Colorado  coal  combine  trust. .  20,000,000 

Condensed  milk  trust,  Illinois  15,000,000 

Confectioners'  trust 2,000,000 

Copper  ingot  trust 20,000,000 

Cordage  trust 35,000,000 

Corn  harvesters  trust 50,000,000 

Cornstalk  trust .50,000,000 

Cotton  duck  trust 10,000,000 

Cotton  press  trust 6,000,000 

Cottonseed  oil  trust 20,000,000 

Crockery  trust 15,000,000 

(^uban  tobacco  trust 20,000,000 

Cutlery  trust  (forming) 2,000,000 

Distilleries  trust 24,000,000 

Dressed    beef   and   provision 

trusts  (two) 100,000,000 

Dye   and    chemical   combine  2,000,000 

Electrical  combine  No.  2 1,800,CK)0 

Electric  light  trust 2.5,000,000 

Electric  supply  trust 10,000,000 

Enameling  trust 30,000,000 

Envelope  trust 7,0(X),000 

Fish  trust 5,000,000 

Flint  glass  trust,  Pennsylva- 
nia   8,000,000 

Flour  trust  (forming) 150,000,000 

Fruit  canners'  trust 500,000 

Fruit  jar  trust 1,000,000 

Fur  combine 10,000,000 

Furniture  trust 12,000,000 


Capital. 
Galvanized     iron    and    steel 

trust,  Pennsylvania 2,000,000 

Glove  trust.  New  York 2  000  000 

Gossamer  rubber  trust 12'oOo'ooO 

Glucose  trust 40,OOo',000 

Green  glass  trust 4,000  000 

Harrow  trust 2,000,000 

Harvester  trust 1,.500,000 

Heating  apparatus  trust 10,000,000 

Hmge  trust 1,000,000 

Hop  combine 500,000 

Indurated  fiber  trust .500,000 

International  Silverware  Com- 

pany  trust  (forming) 30,000,000 

Iron  and  coal  trust 10,000,000 

Iron  and  steel  trust 75,000,000 

Iron  ore  trust 30,000,000 

Iron  pipe  trust 30,000,000 

Iron   tube  trust 60,000,000 

knit  goods  trust 30,000,000 

Lead  trust 30,000,000 

Leather  trust 124,483,000 

Leather  board  trust 500,000 

Lime  trust 3,000,000 

Linotype  trust 5,000,000 

Linseed  oil  trust 18,000,000 

Lithograph  trust.  New  Jersey  11,500,000 

Locomotive  tire  trust 2,000,000 

Locomotive  trust 5  000  000 

Lumber  trust 40,OOoioOO 

Lumber  trust 2,000,000 

Matting  trust 30,000,000 

Manila  tissue  trust $    2,000,000 

IMarblo  trust 20,000  000 

Match   trust 30,000,000 

Matcli   trust,  Chicago 8,000,000 

Monhadcu  trust 10,000,000 

Mcrcliiints'  steel  trust 25,000,0t)0 

Morocco  lea t  licr  t  rust 2,000,000 

^avn^  stores  c()in))ine  trust...  1,000,000 

Oatmeal  trust,  Ohio 3,.500,000 

^!}  i''''«t 12,000,000 

Oilclotli   trust 2,,500,000 

Paint  combine 2,000,000 

Paper  bag  trust 2,000,000 

Paper  box  trust 5,000,000 

Paper  trust 5.5,000,000 

Patent  leather  trust 5,000,000 

Pitch  trust 10,000,000 

Plate  glass  trust,  Pittsburg...  8,000,000 

Plug  tobacco  trust 60,000,000 

Pocket  cutlery  trust 2,tX)0,000 

Pork  coinl)iiio 20,000,000 

Powder  trust 1,500,000 

Preserves  trust,  West  Virginia  8,000,000 

Pulp  trust 5,000,000 

Refrigerator  trust  (forming) . .  8,000,000 

Ribb(m  trust 18,000,000 

Rice  trust,  Chicago 2,500,000 

Rock   salt  combine 5,000,000 

Rubber  trust 50,000,000 

Rubber  trust  No.  2 7,000,000 


650 


APPENDIX. 


Capital. 

Safe  trust 2,500,000 

Salt  trust 1,000,000 

Sandstone  trust.  New  York. . .  1,000,000 

Sandpaper  trust 250,000 

Sash  and  door  combine 20,000,000 

Sash,  door  and  blind  trust. . . .  1,500,000 

i^aw  trust 5,000,000 

School  book  trust 2,000,000 

School  furniture  trust 15,000,000 

Sewer  pipe  trust 2,000,000 

Sheet  copper  trust 40,000,000 

Sheet  steel  trust 2,000,000 

Shoe  trust 20,000,000 

Skewer  trust 60,000 

Smelters'  trust 25,000,000 

Snath  trust 500,000 

Snow  shovel  trust  200,000 

Soap  trust 500,000 

Soda  water  apparatus  trust. . .  3,750,000 

Spirits  trust 7,3.50,000 

Spool  bobbin  and  shuttle  trust  2,000,000 

Sponge  trust 500,000 

Standard  Oil  Company  trust . .  100,000,000 
Standard  Distilling  Company 

(new  whisky  trust) ".  24,000,000 

Starch  trust 10,000,000 

Steel  cars  trust 25,000,000 

Steel  rail  trust 60,000,000 

Steel  wire  trust 90,000,000 

Steel  manufacturers  trust....  200,000,000 

Stove   trust 200,000 

Strawboard  trust 8,000,000 

Structural  steel  trust 5,000,000 


Capital. 

Sugar  trust 75,000,000 

Tack  trust 3,000,000 

Teazle  trust 200,000 

The  Iron  League  trust 60,000,000 

Telephone  trust 26,000,000 

Tin  plate  trust 50,000,000 

Tissue  paper  trust 10,000,000 

Thread  trust 12,000,000 

Tobacco  trust 24,000,000 

Tobacco  combination 2,500,000 

Tombstone  trust 100,000 

Trunk  trust 2,500,000 

Tube  trust 11,500,000 

Type  trust 6,000,000 

Typewriter  trust 18,015,000 

Umbrella  trust 8,000,000 

Vapor  stove  trust 1,000,000 

Varnish  trust 36,000,000 

Wallpaper  trust 20,000,000 

Western  flour  trust 10,000,000 

Wheel  trust 1,000,000 

Whip  trust 500,000 

Whisky  trust 35,000,000 

White  lead  trust 30,000,000 

Window  glass  trust 20,000,000 

Wire  trust 10,000,000 

Woodscrew  trust 10,000,000 

Wool  hat  trust  1,500,000 

Wrapping  paper  trust 1,000,000 

Yellow  pine  trust 2,000,000 


Total, 


5,284,548,000 


To  the  foregoing  should  be  added  the  California  Kaisin  Association— the 
pioneer  farmer's  Trust  of  America.  Its  "capital  stock"  is  small,  but  it  is 
practically,  so  long  as  it  lasts,  a  consolidation  of  the  product  of  the  capital  of  its 
members.  In  1898  these  numbered  2,064.  The  average  capital  of  those  engaged 
in  the  production  of  raisins  was  certainly  not  less  than  $3,000,  which  would 
make  the  capital  of  the  farmers'  raisin  Trust  $6,192,000. 

The  Wine-makers'  Corporation  of  California  is  a  Trust  whose  members  are, 
for  the  most  part,  both  producers  and  buyers,  but  as  their  interests  as  producers 
are  probably  in  nearly  every  case  greater  than  their  interests  as  buyers,  it 
should  perhaps  be  called  a  farmers'  Trust. 


irsiDB:^^: 


ABILITY,  Business,  what  it  consists  of,  24S. 
Agric'lture,    Department   of;  law-changing, 
rank  of,  534. 

—  Law-creating,  533. 

—  Organization  of,  535- 
Agriculture  in  Common  Schools,  5o,  553. 

—  Beginnings  of  in  the  United  States,  60. 

—  Cornell    University,    helps     for     teachers 

of,  554- 

—  Demand  for  it  in  rural  districts,  64. 

—  Demand  for  good  teachers  will  finally  get 

them,  65. 

—  Desirability  of  special  teachers,  65. 

—  Development  of  the  child's  mind,  62. 

—  Difficulty  of  getting  good  teachers,  65. 

—  Does  not  include  farm  operations,  62. 

—  Evidence    of    ability    to    be    required    of 

teachers,  65. 

—  How  to  secure  its  immediate  introduction 

in  any  district,  65. 

—  Introduction  likely  to  be  resisted  by  advo- 

cates  of  other  studies   which   must  give 
way,  67. 

—  Instruction    must    be    suited    to    age    of 

pupils,  62. 

—  Must  be  confined  to  study  of  nature,  62. 

—  No  text-book  needed,  61. 

—  Not  wise  to  push  it  in  advance  of  public 

sentiment,  66. 

—  Progress  of  the  work  in  the  country,  61. 

—  Proper  compensation  for  special  teachers, 

66. 

—  Some  educational  questions  involved,  64. 

—  Some  experience  in  California,  66. 

—  Special  teachers  employed  in  Europe,  66. 

—  Study  delightful  to  children,  63. 

—  Suitable  teachers  the  first  requisite,  63. 

—  Tends  to  keep  the  boys  on  the  farm,  61. 

—  The  best  foundation  on  which  to  build  a 

good  farmer,  63. 

—  Vagueness  of  the  term,  61. 

—  What  is  learned  is  never  forgotten,  63. 

—  What  is  meant  by  it,  60. 

—  Will  be  had  when  the   farmers  demand 

it,  65. 

—  Work  in  New  York,  60,  553. 
Agriculture  ;  not  in  danger,  26. 

—  Short  college  courses  in,  551. 

—  Whether  to  be  exploited  or  not,  26. 
Agricultural  Chemistry;  not  yet  fully  under- 
stood, 70. 

Agricultural  Colleges,  39. 

—  Advantages  of  their  connection  with  great 

universities,  30. 

—  Also  Colleges  of  Mechanics,  39. 

—  Syndicates,  604. 

—  Cost  of  maintaining,  40. 

—  Course  in  as  a  preparation  for  farm  work, 

41- 

—  Educating  boys  away  from  the  farm,  40. 

—  Efltect  of  political  influences,  47. 

—  Erroneous  opinions  in  regard  to,  40. 

—  Few  students  take  full  courses,  44. 


Agricultural  Colleges,  good   instructors  not 
always  good  farm  managers,  46. 

—  Graduates  of,  41. 

—  Graduates  not  necessarily  working  fann- 

ers, 43. 

—  Graduates  professional  men,  43. 

—  Increasing  demand  for  graduates,  44. 

—  List  of  in  U.  S.,  562. 

—  Morrill  Act  donating  land  for,  539. 

—  Morrill  Act  for  endowment  of,  541. 

—  Office  of,  40. 

—  Nature  of  the  course  in,  42. 

—  Result  of  insufficient  revenue,  40. 

—  Some    graduates     return    to    the     farm, 

44. 

—  Students  generally  poor,  44. 

—  The  original  idea,  46. 

—  Time  required  for  graduation,  43. 

—  Will  do  special  work  for  farmers,  41. 
Agricultural  Documents;   state  and  national, 

72,  561. 
Agricultural  Education;  commercial  view  of 
it,  44. 

—  Higher;  demands  the  full  strength  of  the 

student,  46. 

—  In  foreign  countries,  560. 

—  The  broader  view  of  it,  44. 
Agricultural    Experiment  Stations;  list  of  in 

U.  S.,  562. 
Agricultural  Journals,  72. 

—  Intricacy  of    questions    with  which  they 

must  deal,  73. 

—  Limitations  of  usefulness,  72. 

—  Must  cater  to  those  who  supply  their  reve- 

nue, 72. 

—  Not  properly  sustained  by  farmers,  73. 

—  Sources  of  their  information,  74. 

—  Value  of    correspondence    from    practical 

farmers,  74. 

—  What  they  do  for  the  farmer,  74. 
Agricullural  Papers  and  Books,  69. 

—  Schools,  special,  51. 

—  Synidcates,  604. 
Aldrich  Committee,  625. 

—  Index  tables  of,  626. 
Alliance,  Farmers',  290. 
Altruism,  definition  of,  loi,  279. 

—  Economic  science  does  not  deal  with  it,  loi. 

—  In  cooperation,  279. 

—  No  man  without  it,  280. 
Amusements;  those  in  rural  districts  not  al- 
ways decorous,  96. 

Analysis  of  soils;    its  use  and  value  in  agri- 
culture, 69. 

Antagonism,  economic  ;    should  not  produce 
enmity,  384. 

Appreciation  of  gold,  and  interest,  646. 

Arbitration  in  labor  contests,  390. 

Atkinson,  F.  J.,  index  table  of  silver  prices 
in  India,  644. 

Audiences,  popular;  susceptible  to  emotional 
oratory,  lis. 

(651) 


052 


INDEX. 


BANK  ACT,  National,  140. 
Bank    Deposits;   mostly  money  of  poor  peo- 
ple,  134- 
Banker;  necessary  qualities  of,  132. 

—  The  farmers'   best   counselor    in    financial 

matters,  133. 
Bank  Failures,  causes  of,  132. 
Banking,  methods  of,  131. 

—  Sound ;  how  farmers  can  promote  it,  132. 

—  Sound;  farmers'  interests  in  it.  132. 

—  Source  of  profits  of,  131. 

Bank  Loans;    necessity  of  prompt  collection, 

Banks,  causes  of  farmers'  dislike  for,  133. 

—  Cooperative,  605,  609. 

—  Different  classes  of,  135. 

—  Do  not  desire  to  foreclose  mortgages,  ill. 

—  Large ;  functions  of,  134. 

—  Large;    not   themselves   monopolists,   but 

essential  to  monopolists,  134. 

—  Late   proposal  for  security  of  circulation, 

146. 

—  Managers  of,  not  usually  rich  men,  131. 

—  National ;  causes  and  results  of  their  estab- 

lishment, 142. 

—  National ;  great  profits  of  the  earlier  ones, 

M3- 

—  National ;  notes  of,  140. 

—  National ;  not  now  making  undue  profit  on 

circulation,  145. 

—  National ;  present  actual  profit  on  circula- 

tion, 144,  576. 

—  National,  statistics  of,  576. 

—  National;  their  notes  the  first  good  paper 

currency  we  ever  had,  142. 

—  Not  the  enemies  of  farmers,  133. 

—  Notes  of ;  condition  under  the  state  bank 

system,  141. 

—  Notes  of;  history  of  their  use  in  the  United 

Stales,  138-143-         ,         .      ^ 

—  Notes  of;    results  when   inadequately   se- 

cured, 139- 

—  Notes  of,  vs.  government  issues,  146-149. 

—  Private,  statistics  of,  579. 

—  Question  of  allowing  them  to  issue  circu- 

lating notes,  143,  145. 

—  Results  of  •'  runs  "  upon,  136. 

—  Savings,   135. 

—  Savings,  statistics  of,  579. 

—  State  commercial ;  statistics  of,  578. 

—  State;  notes  of  counterfeited,  141. 

—  State;  supervision  of,  151. 

—  Summary  of  statistics  of,  579- 

—  Their  function  of  issuing  paper  money,  137. 

—  Their  dislike  of  foreclosures,  136. 

—  Will   get    highest   interest   rates  possible, 

134. 
Bimetalism,  international  not  probable,  366. 
Bonds,  United  States;  reason  for  not  paying 

in  silver,  364.  ,    ,         ,      ,      ^ 

Book  Farming;  faults  of  early  farm  books, 69. 

—  Modern  farm   books  contain  the  experi- 

ence of  practical  men,  71. 

—  Most  of  the  old  books  really  valuable,  7°- 

—  Nearly   all   books  on    farming  lately  pub- 

lished are  valuable,  71. 

—  Prejudice  against,  69. 

—  Prejudice   arising  from    exaggerated  ex- 

pectations, 69. 

—  Prejudice  partly  due  to  the  fact  that  farm- 

ers do  not   read  the  books  which  they 
condemn,  70. 
Books,  list  of  for  farmers,  566-575- 

—  The  farmer's  family  should  have  them,  94. 
Borrower,  controlled  by  his  creditor,  213. 
Boys,  Farmers' ;  drift  to  cities  for  easier  life 

rather  than  for  more  money,  97. 

—  Have  duties  to  parents,  92. 

—  Inclined  to  drift  off  among  strangers,  94. 


Boys,  Farmers';  shiftless ;    probably  defect 
ives,  92. 

—  Will  be  happier  in  the  country  than  in  the 

c'l^y'  93- 

—  Will  develop  according  to  ability,  94. 
Bounties    on   production,    experience  of    in 

U-  S.,  319- 
Bounty,  export,  see  export  bounty. 
Brokers,  definition  and  methods  of  business 

of,  375. 
Bulletins  of    Experiment   Stations ;    how  to 

get  them,  49,  561. 

—  Of  U.  S.  Department  of  Agriculture  ;  how 

to  get  them,  50,  564. 
Business,  a  science,  205. 

—  Certain  to  flow  in  easiest  channels,  212. 

—  Cooperative,  laws  of  identical  with  those 

of  private  business,  206,  207,  216. 

—  Elements  of  success  in,  202. 

—  In  farming  differs  from  trade,  205. 

—  Liabilities  of,  219. 

—  Principles  of  apply  to  farming,  205. 


CALIFORNIA,    Conditions  of    fresh    fruit 
trade  in,  452. 

—  development  of,  442. 

—  Errors  of  orchardists  of,  444-447. 
California    Fruit    Exchange,  causes    of  fail- 
ure of,  503. 

—  Cost  of  organization  of,  496. 

—  Experience  of,  490-502. 

—  Final  effort  of,  500. 

—  Objects  of,  498. 

—  Organization  of,  489. 

—  Origin  of,  489. 

—  Relations  of  to  local  exchanges,  492. 

—  Work  of,  497- 

California,  fruit  industries  of,  442. 
California  Fruit  Union,  452. 

—  Annual  sales  of,  454. 

—  Capital  of,  453. 

—  Not  sustained  by  growers,  454. 

—  Organization  of,  453. 

—  Reasons  for  going  out  of  business,  455-457- 

—  Weak  points  of,  454- 

California    Raisin    Association;    beginnings 
of,  465. 

—  Benefits  of  to  growers  and  others,  468. 

—  Experience  of,  467. 

—  Nature  of,  467,  650. 

California  Wine-makers  Corporation,   517. 

—  Condition  of  in  1899,  524. 

—  Conditions  leading  to  organization  of,  519. 

—  Difficulties  of,  522. 

—  Difficulty  of  organization  of,  520. 

—  Early  success  of.   522 

—  Nature  of,  521,  650. 

—  Relations  of  vineyardists,  522. 
Cases,  Granger  the,  287. 

Capital,  certain  to  protect  itself,  212. 

—  Control    of    in  hands  of  borrowers  more 

necessary  than  in  hands  of  owners,  150. 

—  Growth  of  in  cooperative  stores,  215. 

—  Tendency  of  to  concentration,  149. 
Capitalists,  farmers  are,  19. 

—  Large,  do  not  receive  high  interest,  135. 
Changes,  greater  in  the  last  fifty  years  than 

in  the  previous  five  hundred,  19- 
Checks,    bank,    perform    the   functions   of 

money,  137- 
Circulation,  per  capita,  349. 
Civil  Service,  192-194. 
Clubs,  farmers',  291. 
Coinage,  Free,  of  Silver,  363. 

—  Argument  against,  371-376. 

—  Argument  for,  376-38.1. 

—  As  law  stands  U.  S.  would  have  to  main- 

tain ratio  at  16  to  i .  365. 


653 


Coinage,  By  U.  S.  involves  change  from  gold 
to  silver  standard,  366. 

—  Demands  of  advocates  of,  363. 

—  Difficulties  <l  question  of,  381. 

—  Expediency  of,  380. 

—  International  not  probable,  366. 

—  Justice  of,  376. 

—  Position  of  European  nations  in  regard  to, 

366. 

—  Proper  method  of  studying  the  question, 

382. 

—  Results  of  uncertain,  365-382. 

—  The  monetary    "question  oi   the   day," 
.363-366. 

Loinage,  law  of  1834,  357' 

—  Law  of  1873,  358. 

—  I.aw  of  1878,  361. 

—  Silver,  in  U.  S.,  362. 

—  Silver,  discontinued  by  Latin  Union,  362. 
C:olleges,  Agricultural  (see  Agricultural  Col- 
leges), 39. 

Commerce,  one  law  of,  127. 
rommission  Business,  a  trust   business   re- 
quiring state  regulation,  155. 

—  Fraudulent  practices  in,  154. 

—  Fundamental  wrong  in,  154. 

—  Laws  regular    ig,  152. 

—  Proper  metluids  of  regulation,  155. 

—  Unsatisfactory  condition  of,  152. 
Commission  Mercliatits,  152. 

—  Attacks  on  by  fainiers,  154. 

—  Competition  among,  155. 

—  Conflict  in  duties  of,  153. 

—  Duty  of,  152. 

—  Folly  of  accepting  advances  from,  157. 

—  How  to  get  a  good  one,  156. 

—  Impropriety  of  dealing  for   his   own   ac- 

count, 153. 

—  Profits  of,  156. 

—  Sales  of  to  themselves,  154. 

—  Should  be  confidential  agent  and  friend  of 

the  farmer,  156. 

—  Their  old  methods,  153. 
Commodities,  relation  of  to  silver  and  gold, 

369,  625.  645. 

c'onimon  Schools,  Agriculture  in   (see  Agri- 
culture in  Common  Schools), 
oniprtition,  all  men  compete  with  all  others 
for  the  possession  of  money.  101. 

'■-  -Mways  results  in  combination,  127. 

—  .Xn  element  in  all  exchanges,  loi. 

—  As  conducted  by  merchants,  102. 

-  Diflerent  kinds  of.  104. 

-  Fconomic  science  assumes  it,  loi. 

-  Haw  it  operates,  100. 

—  The  public  press  will  not  properly  inform 

iarniers,  103. 

-  Cuiversal  in  its  effects,  100. 
Competitors,   cost    of    learning    about   them 

must  be  borne  cooperatively,  104. 

—  How  the  farmer  can  inform  himself  about 

them,  104. 

—  Knowledge  regarding  them  the  most  im- 

portant for  the  farmer,  36. 

—  •  <Ji  the  farmers,  who  they  are.  103. 
Consumers,    importance   of    stimulating  de- 
mand, 37. 

Cooperation,  altruism  in,  279. 

-  .\Itruism  in  Great  Britain,  281. 

-  .-\Itruism  not  a  safe  foundation  for  cooper- 

ative enterprise,  280. 
■  '^operation,  among  farmers,  602. 

-  Among  farmers  in  U.  S.,  44i- 

-  Among  farmers  in  Europe,  604. 

—  Among  others  than  farmers,  605,  609. 

Among  farmers,  result  of  same  forces  that 
produce  cooperation  among  business 
men,  282. 

-  Arguments  for  identical  for  all  forms,  439. 


Cooperation,  a  sign  of  excessive  competition, 
20S. 

—  Benefits  of  in  California,  524. 

—  Californian,  effort  of  to  form  Trusts,  462. 

—  Definition  of  as  used  in  this  volume,  204. 

—  Desirable  only  as  it  increases  comforts  of 

membership,  210. 

—  Development  of  in  different  countries,  435. 

—  Distributive,  205. 

—  Economic  gain  illustrated  by  an  example, 

259-267. 

—  Economic  gain  sufficient  to  justify,  258. 

—  Essential  to  a  successful  fight  with  nature, 

128. 

—  How  induced  among  the  California  fruit- 

growers, 443,  447-451- 

—  How  regarded  by  Socialists,  203,  261. 

—  In  California,  434,  435. 

—  In  California;  degree  of  altruism  in,  440. 

—  In   California;    relations  of  wealthy   pro 

ducers  to,  440. 

—  In  California  ;  some  experiences  of,  440. 

—  In  California,  special  interest  of.  438. 

—  In  Great  Britain,  statistics  of,  607,  608. 

—  In   marketing;    conditions  oi  success  in, 

525-526. 

—  In   marketing  dried  fruits,   beginnings  of 

in  California,  473. 

—  In    marketing    dried    fruits ;    conditions 

leading  to,  470,  473. 

—  In  marketing  dried  fruits,  methods  of  in 

California,  473. 

—  Leaders  of  in  California.  435-438- 

—  Likely  to  begin  among  least  prosperous  of 

the  class  involved,  210. 

—  Most  common  forms  of,  204. 

—  Motives  of  identical  with  those  of  trusts, 

440. 

—  Natural  result  of  excessive  competition, 

207. 

—  Nature  of,  202,  203. 

—  Of  classes,  438. 

—  Of  farmers,  difficulties   of  identical   with 

those  of  cooperation  of  capitalists,  439. 

—  Popular  ideas  of    possible  gain  by  often 

exaggerated,  257. 

—  Proper  field  for  altruism  in,  280. 

—  Relation  of  to  Socialism,  428. 

—  Salaries  paid  by,  438. 

—  Should  not  be  based  on  sentiment,  210,  211. 

—  Ultimate  success  of  not  improbable,  527. 
Cooperative  Banks,  605,  6og. 
Cooperative   Business,   compensation  of  sal- 
aried service  in,  250-255. 

—  Fair  compensation  with   honor,  the  best 

assurance  oi  fidelity  in  management,  256. 

—  How  at    a  disadvantage  compared   with 

competitive  business,  249. 

—  Impossible  without  some  risk,  218. 

—  Influences  to  be  guarded  against  in,  255. 

—  Managers  of  may  be  largely  compensated 

in  honor,  254. 

—  Managers  of  not  generally  respected,  255. 

—  Must  assure  itself  of  support  before  start- 

ing, 211. 

—  Must  be  transacted  by  a  corporation,  207. 

—  Personal   expense  of   managers  of,  if   in 

cities,  253. 

—  Requires  adequate  capital,  209,  229. 

—  Results  when  capital  is  inadeq\iate,  209. 

—  Some  kinds  not  safe  for  farmers,  214. 

—  Successful    only   when    intelligently  man- 

aged, 213. 

—  Success  01  depends  on  personal  equation 

of  membership.  206. 

—  Will  not   he  sustained   if   inconvenient   to 

members,  212. 
Cooperative    Corporations,    effect    of    good 
management  on  credit  of,  225-227, 


654 


Cooperative  Marketing  Societies,  attention 
to  detail  the  key  to  success,  275. 

—  Caution  in  making  advances  essential,  230. 

—  Control  of  retailers  by,  260. 

—  Cost  of  organization  of,  486,  494. 

—  Difficulty  of  organizing,  493. 

—  Difliculty  of  raising  funds  for,  493,  495- 

—  Economic  gain  by  associated  credit,  269. 

—  Economic    gain     by    assurance    against 

losses,  268.  ,    , 

—  Economic   gain    by   assurance  of    honest 

pack,  268. 

—  Economic  gain  by  diffusion  of  business 

knowledge,  269.  ...  ,11 

—  Economic    gain    by   elimination-  of    local 

buyers  and  commission  men,  267. 

—  Economic    gain    by   extending  period   of 

sale,  267.  ....  , 

—  Economic  gain  confined  to  initial  stages  of 

the  progress  of  the  product  to  market, 

—  Economic  gain  in  advertising,  261. 

—  Economic    gain    possible    only    with    an 

assured  volume  of  business  proportioned 
to  outlay  for  plant  and  expenses,  273. 

—  Employment    of     brokers    vs.    traveling 

salesmen,  275-277. 

—  Local ;  difficulty  of  uniting  them  under  one 

head,  492.  503-  ,       ,         ,     . 

—  Methods  necessary  to  the  sale  of  products, 

—  No  economic  gain  in  elimination  of  whole- 

saler or  retailer,  264. 

—  Not    yet    usually  competent    to  maintain 

branch  selling  agencies,  274. 

—  Objects  of  in  California,  232. 

—  Opposed  to  law  of  natural  selection,  271. 

—  Relations    of    with  wholesale   merchants, 

260.  .     . 

—  Should  not  borrow  from  commission  men. 

213. 

—  Substantiallv  Trusts,  509,  522. 

—  Summary  of  economic  gains  by,  270. 

—  Vs  cooperative  purchasing  societies,  260, 

278. 
Cooperative  Societies,  British,  211. 

—  Business  capacity  of  indicated   by  direc- 

tors, 213. 

—  Can  not  safely  incur  debt,  229. 

—  Caution  in  beginning  business  essential, 

—  Danger  from  ignorance  of  stockholders, 

—  Danger  from  infirm  will  of  stockholders, 

—  Danger  from  neglect  of  stockholders,  234. 

—  Danger   from    incompetent    management, 

—  Danger  from  suspicion  of    stockholders, 

—  Directors  should  not  pledge  their  personal 

credit  for,  228.  ,  .        ^      .     j     j    t 

—  Economic  gain  by  raising  the  standard  of 

business  morals,  271-273.  .   . 

—  Encouraged  by  those  who  will  not  ]oin, 

—  Hovv  to  determinequaliiicationsof  possible 

managers,  246-260. 

—  Illustrative  instance  of  failure  of,  223,  237. 

—  Importance  of  good  secretary  and  presi- 

dent, 227. 

—  List  of  in  California,  603. 

—  Management  quite  sure  to  be  honest,  227. 

—  Managers  must  be  honest,  240. 

—  Managers  must  be  vigorous,  243. 

—  Managers  must  have  ability,  243. 

—  Managers  must  have  experience,  or  socie- 

ties must  pay  for  their  mistakes,  244. 

—  Managers  must  have  tact,  244. 


Cooperative  Societies,  managers  must  not  be 
pecuniarily  distressed,  247. 

—  Managers    not    necessarily   accumulating 

men,  239.  ,•     , 

—  Managers    require    all    the    cardinal   and 

minor  virtues,  245. 

—  Managers  sure  to  be  suspected,  242. 

—  Managers  sure  to  be  tempted,  241. 

—  Management  of,  240. 

—  Members   not  entitled  to  half-paid   serv- 

ice, 256. 

—  Membership  always  responsible  for  failure 

of,  221. 

—  Must  do  business  only  for  cash,  214. 

—  Objects  of    among  farmers,  must  be  sim- 

ple, 233,  602. 

—  Perfect  managers  probably  not  attainable, 

240. 

—  Suspicion  of  managers  of,  502. 

—  Waste  of  energy  in   holding  membership 

together,  245. 

—  When  may  be  expected  to  succeed,  214. 
Cooperative  Stores,  94,  210,  602. 

—  How  made  successful,  214. 

Cornell    University;    work    of    in    common 

schools  of  New  York,  60,  553,  560. 
Corporations;  advantages  of,  219. 

—  Assessments  on  paid-up  stock  evidence  of 

mismanagement,  221. 

—  Assessments  on  stock  of,  220,  221. 

—  By-laws  of,  224. 

—  Can    do    only    such    business   as  charter 

specifies,  223. 
—Caution  in  drawing  up  the  charter  essen- 
tial, 224. 

—  Definition  of,  219. 

—  For  cooperative  purposes,  218. 

—  Legal  advice  in  forming  desirable,  225. 
—Popular  prejudice  against,  218. 

—  Safer  than  partnerships,  220. 
Corners,  speculative  ;  how  settled,  178. 

—  Speculative,  meaning  of,  i77- 

—  Results  of,  177-        ,  .,■.«. 
Corruption  in   Legislatures;    how  it   affects 

railroads,  159. 

—  Opportunities  for  in  legislative  positions. 

Costs,    decrease    in    manufactured    goods, 

—  Farmers  must  learn  to  reduce,  33. 

—  Of  produce  not  generally  known  by  farm- 

ers, 3S.  .. 

—  Reduced  by  studies  of  scientific  men,  33. 

—  Reduction  possible  only  by  study  of  de- 

tails, 35.  ,  .  . 

—  Work   of   chemists  and   engineers  in   re- 

ducing, 33- 
Country  Life  easier  than  city  life,  92. 
Courses,  short ;  in  agriculture,  51.  55i- 
Cover  crops ;  plants  suitable  for,  86. 
Credit ;  business  transactions  depend  upon 

it,  355- 

—  Results  of  failure  of,  355-    .. 
Creditors;  will  respect  maiihness  and  cour- 
age in  debtors,  in. 

Crime,  of  1873  a  mytli.  359-.       ^         .,   „. 
Crop;  necessilv  of  adaptation  to  soil,  h'6. 
Currency,    bad;    the    poorest    people  sutler 
most  by  it,  139. 

—  Bank :  elasticity  of,  148. 

—  Government ;  danger  of  overissues,  148. 

—  Government ;     loans    to    the    people    ni. 

148. 

—  Government  vs.  bank  notes,  146,  149. 

—  Inflated  ;  not  good  money,  344.  347- 

—  Question,  object  of  study  of,  610. 

—  Statistical  authorities  for,  613. 

—  Statistics  of,  610-645. 


INDEX. 


655 


DAIRY  SCHOOLS  ;  compensation  of  gradu- 
ates, 53. 

—  Course  of  study  in,  53,  546. 

—  Methods  of,  52,  546. 

Death;  what  evolutionists  mean  by  it,  23. 
Debt;    the  cause    of    most   deviations   from 
honesty,  247.  ..        ,  , 

—  Unless  to  run  a  long  time  not  relieved  by 

free  coinage,  375. 
Debtors;  formerly  sold  as  slaves,  no. 

—  Must  frankly  look  their  condition  in  the 

face,  109. 
Deferred  payments ;  standard  of,  367. 
Demonetization,  of  silver,  622. 
Department  of    Agriculture;    Bulletins,   and 

how  to  get  them,  50,  561-566. 
Depreciation  of  silver,  360. 
Diagrams,   statistical,  caution    in   regard   to 

use  of,  612.  614,  615. 
Direct  Legislation  ;  arguments  for,  413. 

—  Common  in  U.  S.  in  local  affairs,  413. 
— Educational  value  of,  419. 

—  If  wise  would  require  all  the  time  of- the 

people,  417. 

—  Initiative  and  referendum,  415. 
^  In  Switzerland,  420. 

—  In  municipal  aflfairs,  416,  420. 

—  Likely  to  be  conservative,  420. 

—  Necessary  limitations  of,  418,  419. 

—  Not  desirable  that  it  advance  too  rapidly, 

415- 

—  Not  yet  a  real  question  of  the  day,  418. 

—  Obstacles  to  its  progress,  414. 

—  Rapidly  gaining  support,  415. 

—  Some  proper  subjects  of,  418. 

—  Very  expensive,  418. 

Discontent ;  causes   of,  do  not  operate  uni- 
formly, 122. 

—  Of  the  weaker  and  indebted,  121. 

—  Part  of  man's  nature,  124. 
Discontent  of  the  Farmer,  120. 

—  Causes  of,  121,  122. 

—  remedies  for,  126. 

—  Result  of  proposed  remedies,  128. 
Discriminations;  railroad,  167. 

Distress  ;  result  of  changes  occurring  more 

rapidly  than  man  can  adjust  himself  to 

them,  19. 
Documents;  state  and  national  agricultural; 

how  to  obtain  them,  72,  561-566. 
Drainage;  importance  of,  !>;. 
Dried  Fruits;  early  methods  of  handling  and 

marketing  in  California,  471. 


ECONOMIC    ANTAGONISM    should    not 

produce  enmity,  384. 
Economics,  problems  of;   rest  upon  ethical 

problems,  124. 
Economic   Science;    assumes    competition, 

100. 

—  Does  not  deal  with  altruism,  loi. 
Economics;    some  knowledge  of   is    essen- 
tial to  successful  farming,  38. 

—  What  it  is,  37. 
Econemist,  index  tables  of,  639. 
Economists;  high  character  of,  303. 

—  Modern,  mostly  free  traders,  303. 

—  Reasoning  of  in  regard  to  tariff,  303. 
Education,    Agricultural  ;   commercial   view 

of  it,  44. 

—  The  broader  view  of  it,  44. 
Education  of  the  farmers'  children,  93. 
Education,  the  farmers;  what   is  and  what 

is  not  meant  by  it,  32. 

—  The  higher  agricultural ;  demands  the  full 

strength  of  the  student,  46. 
Elections  ;  use  of  money  in,  117. 


Elections,  who  supply  money  for,  n8. 
Employees,  the  Farmers',  94. 

—  socially  the  farmers'  equals,  95. 
Environment,  influence  of,  18. 
Exchanges,     modern  ;     inextricably     inter- 
woven, lOI. 

—  Speculative ;  how  conducted,  178. 

—  What  they  actually  are,  102. 

—  What  they  would  be  with  an  ideal  race, 

102. 
Existence,  struggle  for,  loi. 

—  How  modified,  loi. 
Expenditures,  Public;  in  U.  S.,  298. 

—  Possible  economies  in,  189. 
Experimental  farms  can  never  yield  a  net  in- 
come, 47- 

Experimenting  an  art,  48. 
Experiment   Stations,    Agricultural;    Hatch 
Act  for  establishment  of,  543. 

—  Extremely  valuable  work  of,  48,  49. 

—  Means  limited,  49. 

—  National  appropriation  for.  48. 

—  Necessity  arose  from  impossibility  of  good 

farming  by  students,  47. 

—  The,  46. 

—  Value  not  fully  recognized,  48. 

—  Work  seldom  appreciated  by  neighboring 

farmers,  47. 
Experiments  in  digestion  ;  value  of,  48. 
Export  Bounty,  as  a  question  of  the  day,  313. 

—  Certain  results  of,  317. 

—  Cost  of  to  U.  S.  if  given  as  proposed,  318. 

—  Definition  of,  313. 

—  European  experience  in,  315,  316,  319,  320. 

—  Justice  of,  as  claimed  by  its  advocates,  313. 

—  No  part  of  policy  of  protection,  315. 

—  Not  endorsed  by  any  economist,  315. 

—  Not   endorsed  by  any  national  organiza- 

tion, 313. 

—  Relation  of,  to  question  of  protection  and 

free  trade,  314. 

—  Results  of,  as   claimed  by  its  advocates, 

314- 

—  Sufficient  objection  to,  316. 
Evolutionists;    not   understood  by  farmers, 

20. 
Evolution,  of  the  farmer,  18. 

—  Of  species,  18,  567- 

—  Possible  result  of,  127. 

—  What  it  means,  127. 


FAMILIES,    Shiftless;     in  process    of    ex- 
tinction, 32. 
Farm,  adaptability  for  home,  82. 

—  As  a  source  of  income,  84. 

—  Considerations  determining  value  of,  82. 

—  Fertile;    means  one  which  will  produce 

crops  at  profit,  84. 

—  Is  a  factory,  87. 

Farm  Life;  lacks  social  intercourse,  96, 
Farm,  most  common  abuses  of,  84. 

—  Practice,  local;  usually  well  understood  by 

farmers,  32. 

—  Practice;  to  be  learned  only  on  the  farm, 

32- 

—  Products,  danger  of  accepting  large  ad- 

vances on,  231. 

—  The  products  of;   largely  determined  by 

location  with  reference  to  markets,  88. 

— Products,   profits  of;   most    profit    in    Hie 

crops  requiring  most  brain  work,  88. 

—  Products,  value  of  as  security,  230,  231. 

—  Robbing  the  soil  of,  85. 

—  Sources  of  fertility  abundant,  85. 

—  The  storehouse  of  vigor,  25. 

—  Value  affected  bv  character  of  communitv, 

83. 


656 


INDEX. 


Farm,  value  aflfected  by  roads  of  vicinity,  83. 

—  Value  affected  by  character  of  surround- 

ing land,  83. 

—  What  is  included  in,  84. 

—  What  the  study  of  consists  in,  88. 
Farmer,  American;  ambitions  of,  124. 

—  His  condition  as  compared  with  others  of 

his  race,  24. 

—  Seldom   fails  in  efforts  for  his  children's 

welfare,  93. 

—  And  his  competitors,  100. 

—  And  his  creditors,  106. 

—  And  the  eight-hour  day,  124. 

—  And  his  family,  89. 

—  And  his  fellows,  96. 

—  And  the  laborer,  384. 

—  And  the  politician,  113. 

—  At  a  disadvantage  in   business  transac- 

tions, 7. 

—  At  a  disadvantage  with  other  classs,  19. 

—  Attitude  of  towards  Socialism,  432. 

—  Being  distanced  by  wiser  classes,  27. 

—  Can  inform  himself  only  by  cooperation, 

—  Can  not  succeed  if  constantly  changing  his 

products,  88. 

—  Competes   in   distant  markets   which    he 

can  not  visit,  16. 

—  Competes  with  all  other  farmers,  15. 

—  Could  not  now  live  without  the  aid  of  what 

science  has  done,  34. 

—  Danger  of  debt,  16. 

—  Decadence  of  prosperity  unnecessary,  25. 
Farmer ;    difficulty  of    informing  himself  as 

to  competition,  103. 
Farmer,  Discontent  of,  120. 

—  Causes  lie  deep,  128. 

—  Remedies  for,  126. 

— Result  of  proposed  remedies,  128. 
Farmer ;    duty  to  family    measured   by   his 
ability,  93. 

—  Evolution  of,  18. 

—  Fails  to  understand  woman's  nature,  90. 

—  His  boys  must  have  some  trade  or  pro- 

fession, 92. 

—  His  children  subject  to  illusions,  91. 

—  His  lot  easier  than  that  of  other  classes, 

104. 

—  His  wife  nrovides  half  the  income,  91. 

—  Hope  of,  22. 

—  How  affected  by  monopolies,  126. 

—  Life  of,  124,  430. 

—  Life  of  incompatible  with  Socialism,  431. 

—  Mental  competence  of,  120. 

—  Modern;  conditions  under  which  he  lives, 

—  Modern  ;  nothing  new  in  this  book,  7. 

—  Modern;  useful  toothers  than  farmers,  8. 

—  How  to  make  political  influence  felt,  117. 

—  Interested  in  a  stable  currency,  16. 

—  Interests  intertwined  with  others,  8. 

—  In  the  end  must  cooperate,  128. 

—  In  what  offices  most  interested,  115. 

—  Isolate  ■  lite  tends  to  discontent,  120. 

—  Must  study  in  order  to  vote  intelligently, 

"5- 

—  Must  study  the  forces  which  control  him, 

8. 

—  Must  watch  his  competitors,  102. 

—  Musi  be  a  broadly  educated  man,  17. 

—  Must    be  considered   in    connection   with 

others,  128. 

—  Must  cooperate  or  fail  of  success,  19. 

—  Must  know  something  of  economics,  16. 

—  Must  not  expect  politicians  to  present  sub- 

jects fairly,  114. 

—  Must  often  borrow  money,  16. 

—  Necessity  of  accurate  knowledge  of  com- 

petition, 10^. 


Farmer,  New;  must  be  first  of  all  a  business 
man,  15. 

—  New;   must   protect  himself  by  his  vote, 

16. 

—  New;  uses  far  more  money  than  the  old 

farmer,  15. 

—  None  but  the  strong  can  realize  their  rea- 

sonable ambition,  125. 

—  Not  always  the  best  judge  of  his  own  ail- 

ments, 126. 

—  Objections  of,  to  Socialism,  429. 

—  Obligations  to  his  children,  91. 

—  Obligations  to  his  wife,  89. 

—  Often  misled  by  demagogues,  17. 

—  Old  life  of  the  farmer  not  now  possible  or 

desirable,  15. 

—  Old  ;  his  life  in  the  middle  of  the  ninetenth 

century,  11-14. 

—  Old;  saw  very  little  money,  14. 

—  Old;  social  and  intellectual  condition,  13. 

—  Old  ;  well  nourished  and  happy,  14. 

—  Only  essential  class,  8. 

—  Pecuniarily  affected  by  politics,  115. 

—  Points  of  difference  and  agreement  with 

laborers,  385. 

—  Position  of  in  reference  to  demands  of  labor, 

388. 

—  Should  produce  what  most  interests  him, 

87- 

—  Small;   conditions  upon  which    his  con- 

tinued existence  depends,  15. 

—  Small ;  danger  to  his  existence  as  a  class, 

17- 

—  Real  causes  of  his  discontent,  123. 

—  Relations  as  a  business  man,  7. 

—  Relations  to  other  classes,  123,  126. 

—  Result  of  voting  after  studying  only  one 

side  of  a  question,  115. 

—  Standard  of  life,  123,  125. 

—  Successful ;  need  not  be  a  scientific  man, 

31- 

—  The  Scientific,  28. 

—  Thrifty ;  must  devote  some  time  to  study, 

35- 

—  Training    does    not    prepare   for   public 

speech,  20. 

—  Unscientific  in  competition  with  the  stu- 

dent of  farming,  30. 

—  What  should  he  get  from  his  farm,  122. 

—  Who  can  produce  cheapest  will  survive 

at  the  expense  of  others,  16. 
Farmer's  Alliance,  290. 

—  Radicalism  of,  291. 

—  Relations  of,  to  Grai  ge,  290,  291. 

—  Relations  to  political  action,  290. 
Farmers;  belong  to  the  capitalist  class,  19. 

—  Business  education  essential  for,  19. 

—  Can  stop  waste  of  money  on  country  roads 

200. 

—  City,  71. 

—  Clubs,  291. 

—  Clubs,  weakness  of  as  compared  with  rit- 

ualistic societies,  292. 

—  Causes  of  lack  of  prosperity,  33. 

—  Condition  early  in  nineteenth  century,  106. 

—  Cooperation  among,  602. 

—  Desire  of,  for  cheaper  money,  150. 

—  Hrrors  of,    in    dealing    with    commission 

merchants,  154. 

—  Evidence  of  increasing  power,  27. 

—  F"ail  in  knowledge  of  what  their  competitors 

are  doing,  102. 

—  Feeling  of  many  in  regard  to  science  ap- 

plied to  agriculture,  28. 

—  Financial  strength    of,    when    combined, 

212. 

—  Great    sums  of   public  money  spent    for 

their  benefit,  50. 

—  Habit  of  reasoning  on  false  premises,  9j. 


INDEX. 


657 


Farmers,  have  not   usually  understood  rail- 
road questions,  159. 

—  Have  the    basis    of    success    in    physical 

strength,  26. 

—  How  they  should  deal  with  trades  men,  184. 

—  Indebted  ;  benefits  arising  from  compro- 

mise of  indebtedness,  112. 

—  Indebted ;  consider  their  creditors  his  ene- 

mies, no. 

—  Indebted;  not  required  to  remain  slaves,  no. 
—Indebted;  should  be  perfectly  frank   with 

their  creditors,  in. 
—Indebted  ;  steps  to  be  taken  for  payment  ot 
compromise,  in. 

—  Indebted;   they  are  hurt  by  worry  more 

than  by  work,  112. 

—  Indebtedness  of;  largely  incurred  for  land 

at  too  high  prices,  108. 

—  Insist   on  payment  of  debts  due  to  them- 

selves, no. 
Farmers  Institute;  the,  55. 

—  Aims  and  methods,  59. 

—  Difficulty  of  obtaining   good   non-profes- 

sional instructors,  57. 

—  Farmers  who  say  they  can  learn  nothing 

from  them,  59. 

—  Gets  farmers  to  thinking  and  talking,  55. 

—  How  controlled  in  different  states,  56. 

—  Importance  of  enlisting  local  talent,  56. 

—  Management  of,  56,  58. 

—  On  Pacific  Coast,   57. 

—  Nature  of  topics  discussed,  56. 

—  Professional  vs.,  non-professional  instruc- 

tors, 57. 

—  Requirements  for  non-professional  instruc- 

tors, 58. 

—  Supported  by  state  funds,  56. 

—  What  it  is,  55. 

Farmers  ;  largely  mortgaged,  109. 

—  likely  to  engage    in  cooperation   without 

adequate  capital,  209. 

—  List  of  books  for,  566-575. 

—  Must  adapt  themselves  to  their  changing 

environment,  21. 

—  Must  learn  to  reduce  costs,  33. 

—  Organizations  of,  284. 

—  Proper  course  of  with  regard  to  banks, 

100-151- 

—  Should  vote  to  strengthen  the   Interstate 

Commerce  Commission,  175. 

—  Sources  of  the  most  valuable  information 

for,  72. 

—  Unrest  of  American,  33. 

—  Value,  to  farmers,  of  the  habit  of  writing 

to  farm  papers,  74. 
Farm  Products,  home  prices  of,  636-638. 

—  Relative  New  York  price  of,  634. 
Farms;  unprofitable  unless  actually  worked 

by  owners,  71. 
Farming;  books  (see  Book  Farming),  6g. 

—  Scientific,  prejudice  against  the  term,  28. 
Fertilizers,  commercial ;  uses  of,  86. 
Fertility,  causes  of  loss  of,  85. 

Fit,  the  survival  of,  2i. 

Flattery;  employed  to  influence  farmers,  114. 
Foods ;  compete  with  all  other  foods,  100. 
Fortunes,  great,  result  of  exceptional  ability 

with  accumulating  instinct,  258. 
Freights  (see  Railroads). 

—  Rates  per  ton  per  mile,  646. 

Fruit    Fxchange,   California  (.see    California 
Fruit  Exchange). 

—  Santa    Clara   County     (see    Santa    Clara 

County  Fruit  Exchange). 

—  Fruit  Exchange,  Southern  California  (see 

Southern  California  Fruit  Exchanges). 
Funds,  party;  names  of  contributors  should 
be  public,  118. 

—  Public ;  result  of  wasteful  expenditure,  187. 


GEOGRAPHY,  PHYSICAL;  importance 
not  vet  recognized  in  universities,  37. 

—  The  first  thing  for  the  farmer  to  study,  36. 

—  Well  uiuterstood  by  commercial  men,  37. 
G      I,  a  commodity,  368. 

—  .\ppreciation  of,  378,  614. 

—  Ratio  of  to  silver,  618-622. 

—  Relation  of,  to  commodities,  369,  625,  645. 
Gold  Standard,  argument  for,  371-376. 

—  Expediency  of,  373. 

—  Justice  of,  371. 

Gold,  value  as  compared  with  silver,  356. 

—  World's  production  of,  617. 

—  World's  stock  of,  616. 
Governments,  credit  of;  as  compared  with 

banks,  147. 
Gra/duates  of  Agricultural  Colleges,  41. 

—  Professional  men,  43. 

—  Some  return  to  farm,  44. 

Grange,  the  ;  influence  of  woman  in,  289. 

—  Influence   of,   in    contest    with    railroads, 

287. 

—  National  and  state,  288. 

—  Objects  of,  285. 

—  The  ;  position  in  regard  to  speculation  in 

farm  products,  180. 

—  Rise  and  progress  of,  286. 

—  Ritual  of,  289. 

—  "  Secresy  "  of,  289. 

—  Subordinate,  work  of,  288. 
Granger  cases  the,  287. 

Grange's  dealings,  with  tradesmen,  184. 

HATCH,  WM.,  Introduces  bill  for  establish- 
ment U.  S.  Agricultural  Experiment 
Stations,  543. 

Hope  of  the  farmer,  22. 

—  in  what  it  consists,  27. 

Humbug;  farmers  considered  susceptible  to, 
113- 

—  The  most  effective  weapon  of  politicians, 

113- 
Humus,  chemical  action  of,  86. 

—  How  to  replenish,  85. 

—  Importance  of  in  soil,  85. 

—  Result  of  exhaustion  of,  85. 


IMMIGRATION,    European;    its    effect  on 

American  farmers,  106. 
Income,  farmers',  affected  by  causes  beyond 

his  control,  37. 

—  Vary  in  ratio  of  definite  facts  known,  22. 
Indebtedness,  farmers';  as  the  result  of  spec- 
ulative development  of  industries,  109. 

Index  Tables,  370.  (See,  also,  Aldrich,  Atkin- 
son, Economist,  Sauerbeck,  Soetbeer, 
and  Wetmore.) 

—  Best    available    standards  for  estimating 

value  of  precious  metals,  371. 
Industries,  household,  in  old  times,  12. 
Infertility,  most  common  causes  of,  84. 
Information,  necessary  ;  cost  of  too  great  for 

single  farmers  to  acquire,  19. 
Initiative,  415. 

Institute,  Farmers'(see  P'armers'Institute)55. 
Interest,    rates  of;  have  not   fallen  on   farm 

loans,  377. 
Interest,  rates  in  U.  S.,  647. 
Interstate  Commerce  Commission,  168. 
'decisions  of,  580-598. 

"OTE.— The  decisions   of    the   Interstate 

Commerce  Commission  are  not  indexed 

in  detail,  in  tl;^.  volume.) 
Interstate  Commerce  ComTiiission,  Extracts 

from  Report  of,  598. 
Issues  National  ;    less  important  to  farmers 

than  local,  116. 


(N^ 


42 


658 


INDEX. 


JOURNALS,  Agricultural   (see  Agricultural 

Journals),  72. 
Judgments;  do  not   differ  when  men  agree 

upon  facts,  9. 


KNOWLEDGE,  If  real  influences  action,  22. 

—  Money  value  of,  22. 

—  More    required    for   production    for   the 

world's   markets  than  for  a   home  mar- 
ket, 36. 

—  Not  s<Might  except  as  it  affects  income,  22. 

—  The  most  important  for  the  farmer,  36. 

—  Unprofitable  to  acquire  what   will  not  be 

used,  42. 

—  not  vague  speculation  but  mastery  of  facts, 

27- 


LABOR,  claim  of  that  the  judiciary  unduly 

favors  capital  unfounded,  392. 
Labor  contests,  arbitration  in,  390. 
Labor,  demands  of  as  to  hours  of  work,  386. 

—  Demand  of  that  military  shall  not  be  em- 

ployed in  strikes,  391. 

—  Farmers'  relation  to,  384. 

—  Organized,  385. 

—  Organized,  at  variance  with  unorganized 

labor,  385. 

—  Organized  demands  of,  385. 

Labor,  physical;  how  it  clashes  with  de- 
mands of  the  class-room  13. 

—  Physical,    not    possible    while    acquiring 

higher  education,  46. 

—  Purchasing  power  of  628. 
Labor  Question,  definition  of,  385. 

—  Relations  of  farmers  to,    385. 

—  Short  hours  of  not  desirable,  430. 

—  Socialistic,  demands  of,  394. 

Land,  agricultural ;  now  as  dear  as  it  is 
likely  to  be,  107. 

—  Not  economically  cultivable  by  capitalistic 

methods,  431. 

—  Sanction  of  society  for  ownership  of,  430. 

—  Speculation  in,  107. 

—  Unearned  increment  of,  429. 

—  Value  of  ownership  of,  429. 

—  Values,  taxation  of,  340. 

—  Worth  less  than  improvements  on,  429. 
Law,  judge  made;    ignorant  legislators  re- 
sponsible for  most  of  it,  393. 

Learning,  great,  no  assurance  of  happiness, 
430-     , 

Legal  tender,  348,  351.  . 

Legislation,  direct.  (See  Direct  Legislation 
and  Referendum.) 

Legislators,  dishonest,  influence  of,  418. 

Legislatures  ;  corporations  prefer  them  to  be 
honest,  158. 

Life  Insurance,  as  affected  by  change  to  sil- 
ver standard,  375. 

Life,  Law  of,  ii. 

—  Law  of;  operation  on  man,  21. 

Loan  and  Trust  Companies,  statistics  of,  578. 


MAN;  conditions  of  survival,  21. 

—  Subject  to  the  universal  law  of  life,  21. 

—  The  accumulating ;  characteristics  of,  130. 

—  The  unjust;  not  usually  a  banker,  130. 
Marketing ;  art  of,  not  usually  understood  by 

farmers,  35.  .        ,    ,  , 

—  Cooperative,  highest  exercise  of  the  art  of 

cooperation,  434. 
Men;  classed  as  owners  and  non-owners  of 
property,  24. 

—  Those  who  know  most  have  most,  22. 
Merchandise,  cost  of  selling  from  first  hands, 

263,  277- 


Merchants,  retail,  relations  with  wholesalers, 
262. 

—  Commission,  152. 

Money,  actual,  ratio  of  used  in  transacting 
modern  business,  349. 

—  Actual ;  uses  of,  349. 

—  Actual  value  imparted  to  it  by  making  it 

legal  tender,  351. 

—  As  a  measure  of  value,  350. 

—  As  a  measure  of  value ;  essential  qualities 

of,  351- 

—  As  a  medium  of  exchange  not  a  question 

of  the  day,  342. 

—  Bad;  can  not  be  forced  to  circulate    with 

good,  352. 

—  Bad,  may  do  the  work  of  good,  343. 

—  Coined  gold  and  silver  the  best,  353. 

—  Depreciated  ;   poor  suffer  most  by  it,  348. 

—  Fiat,  results  of  use  of,  346. 

—  Fiat,  use  of  not  desirable,  348. 

—  Gold  and  silver  always  used  for,  356. 

—  Good,  one  essential  quality  of,  342. 

—  Government  paper,  objects  of  issue  of,  347. 

—  Gresham's  law  of,  354, 

—  Ideal,  347. 

—  Increase  of  raises  prices,  352. 

—  International,  343. 

—  Irredeemable;  theoretically  may  be  made 

satisfactory,   but    practically    never  has 
been,  353. 

—  Loans  of  by  government  to  the  people,  148. 

—  Made  scarce  and  dear  by  overtaxation,  150. 

—  Necessity  of,  137,  345. 

—  Non-exportable,  348,  353. 

—  Of  the  world  must  be  considered  as  one 

stock,  353. 

—  Per  capita,  349. 

—  Power,  control  of  our  gravest  problem,  149. 

—  Relations  of  supply  of  to  prices,  354. 

—  Representative,  343. 

—  Representative  not  international,  343. 

—  Standard  of  deferred  payments,  367. 

—  Stocks  of  in  world,  625. 

—  Substitutes  for,  345. 

—  Supply  of,  as  affecting  prices,  367. 

—  Use  of  in  elections,  118. 

—  Usual  definition  of,  350. 

—  Will  always  be  found  where  desired  pro- 

ducts are  for  sale,  344. 
Monetary  Systems  of  the  world,  624. 
Monopolies;  how  they  affect  the  farmer,  126. 
Morrill,  J.  S.,  introduces  Agricultural  College 

Bill,  539- 

—  Introduces  second  act  for  endowment  of 

Agricultural  Colleges,  541. 
Mortgages  ;  banks  dislike  to  foreclose  them, 
III. 


NAFTZGER,  A.  H.,  Letter  from,  514. 
Nature ;  does  not  consider  abuses  but  condi- 
tions, 20. 

—  Law  of,  127. 

—  Man  can  conquer  only  by  cooperation,  128. 

—  Phenomena  of,  42. 

—  Relentless  and  remorseless,  20. 

—  Study  (see  agriculture  in  common  schools), 

60,  553.  560- 

—  What  she  requires  of  man,  23. 
Nelson,  N.  O.,  letter  from,  606. 
Nominations,  improper;  how  best  prevented, 

116. 

OFFICIALS,  Public;  can  not  practice  private 
economy,  190. 

—  Usually  personally  honest,  113. 
Offii-es,  appointive,  118. 

—  The  most  important  to  a  farmer,  115. 


i 


659 


Offices,  which  should  seek  the  man,  117. 

—  Which  the  man  may  properly  seek,  117. 

Orange-growing  in  southern  California,  505. 

Orange-growers;  miscalculations  of,  in 
southern  California,  506. 

Orange-marketing;  early  cooperation  in,  508. 

Orators,  political ;  what  they  aim  to  accom- 
plish, 114, 


PAPERS;  The  daily  paper  a  nuisance  on  the 

farm,  70. 
Parties,  political  ;  usefulness  of,  116. 
Party,   political;  poverty  the  most  honorable 

condition  of,  ti8. 
Patrons  of  husbandry  (see  Grange). 
Personal  equation,  2c6. 
Platforms,  political ;  how  usually  constructed, 

114.  115- 
Politician,  and  the  farmer,  113. 

—  Honesty  of,  113. 

—  May  become  a  statesman,  113. 

—  Meaning  of  the  term,  113. 

Politicians  ;  opposed  to  reform  in  eivil  serv- 
ice, 194. 

Political  speakers;  do  not  present  questions 
fairly,  114. 

Precious  metals,  stability  of  value  of,  368. 

Prices,  as  affected  by  money  supply,  367. 

—  Course  of,  625. 

—  Fixed  bv  credit  more  than  by  monev  sup- 

Plv,  555- 
Produce ;    cost   of,   not   generally  known   bv 

farmers,  35. 
Production,  art  of;  generally  well  understood 

by  farmers,  35. 

—  For  the  home  market  different  from  pro- 

duction for  the  world's  market,  36. 
Products,  agricultural ;  farm  costs  but   little 

reduced,  377. 
Protection  (see  TariiT). 
Prune-growers'  Association,  Pacific,  487. 
Public  questions;    always  involve  economic 

problems,  115. 


RAILROADS,  Abuses  by,  168, 

—  Best  controlled  through   Interstate  Com- 

merce Commission,  175. 

—  Can  be  controlled  by  the  people,  173. 

—  Capitalization  of,  in  United  States,  161,  599. 

—  Capital  honestly  invested  in  entitled  to  pro- 

tection, 165. 

—  Circumstances      making      discrimination 

proper,  169. 

—  Competition  among,  169. 

—  Different  kinds  of  competition  among,  170. 

—  Difficulties  which  they  meet,  158. 

—  Discriminations  by,  167. 

—  Dividends  of;   problems  concerning,    163- 

165. 

—  Early  administration  of,  163. 

—  Entitled  to  no  secrets  from  the  public,  173. 

—  Farmers'  true  policy  regarding,  175. 

—  Folly  of  indiscriminate  attacks  upon,  159. 

—  Freights;  cost  of,  165,  646. 

—  Freight  tariffs  of ;  how  constructed,  166. 

—  Fundamental   principle    underlying  effec- 

tual control,  173. 

—  Government  ownership  of,  172. 

—  Interests  usually  identical  with  communi- 

ties served  by  them,  159. 

—  Interstate  Commerce  Commission,  168. 

—  Interstate  Commerce  Commission  reports 

best  source  of  information  concerning,  174. 

—  Largely  built  on  borrowed  money,  108. 

—  Not  always  wisely  managed,  159. 

—  Officers    of;     some  honorable    and    some 

otherwise,  171. 


Railroads,  officers  of,  will  seek  to  get  a  rev- 
enue somehow,  171. 

—  Perjury  by  officials  of,  168. 

—  Problems    concerning,   very   complicated, 

160. 

—  Problems  of  control  of,  173. 

—  Questions  concerning;  should  be  studied 

without  passion,  158. 
Railroad  questions  ;  usually  contests  between 

localities,  160. 
Railroads,  receipts  of,  in  1896,  162. 

—  Regulation  of,  160. 

—  Slati.stics  of,  in  V.  S.,  599. 

—  Tariffs  of;  must  be  reasonable,  163. 

—  Tariffs  of,  really  a  tax,  162. 

—  True  functions  of    state  commissions  of, 

175- 

—  "  Watered  "  stocks  of,  161. 

—  Will   carry  all   freight  which    yields    any 

profit,  170. 

Raisin  Association,  of  California  (see  Cali- 
fornia Raisin  .Association). 

Raisins,  early  methods  of  sale,  459.  461. 

Raisin-growers,  condition  of,  in  1S97,  461. 

—  Difficulties  of  effecting  cooperation  among, 

462. 

—  Difficulties  of,  in  marketing,  459. 

—  Early  cooperation  among,  460. 
Raisins,  methods  of  production.  458. 
Ratio,  changes  in  legal,  in  U.  S..  357. 
Ratios  of  gold  and  silver,  3.16,  360.  618-622. 
Ratios  of  gold  and  silver,  greaterthan  16  to  i, 

.367. 

Ratio  of  silver  to  gold  never  has  been  per- 
manent, 357. 

Rational  enioyment ;  a  proper  end  of  life,  98. 

Recall,  power  of  not  desirable,  416. 

Recreation,  does  not  consist  in  hoeing  pota- 
toes, 46. 

Referendum,  415,  417. 

Reform,  social  (see  Social  Reform). 

Reforms,  alwavs  first  advocated  bv  extrem- 
ists, 414. 

Rent,  economic,  in  Great  Britain,  328. 

—  Economic,  meaning  of,  324. 

—  Economic,  tends  to  be  absorbed  by  labor, 

431- 
Roads,   country;  cost  of  moving  freight  on, 
196. 

—  Country,  effect  of  good,  in  European  coun- 

tries, 197. 

—  Country,  large  expenditure  on,  196. 

—  Country,   method  of  computing  what  can 

profitably  be  expended  on  them,  198,  199. 

—  Country,  question  of  state  aid  to,  200.' 

—  Country  ;  wisdom  of  incurring  public  debt 

for  depends  on  circumstances,  200. 

—  Farmers  can  stop  waste  of  money  on,  200. 

—  Good  country  ;  common  sense  must  be  used 

in  expenditure  for,  197. 

—  Good  country ;  effect  on  value  of  land,  199. 
Rural  effort,  essential  to  existence  of  the  race, 

422. 


SALARIES,  Large,  the  price  paid  for  great 
knowledge,  23. 

—  Of  cooperative  managers,  606. 

—  Public,  often  not  high  enough,  192. 

—  Public,  wastefulness  in,  189. 
Satisfactions;  economic  definition  of,  loi. 
Santa  Clara  County  Fruit  Exchange,  begin- 
nings of.  477. 

—  Begins  business,  480. 

—  Benefits  of,  to  growers.  481. 

—  Cost  of  organization  of,  479. 

—  Difficulties  in  organization,  478. 

—  Experience  of,  482-484. 

—  Relations  of,  to  local  trade,  479- 


660 


INDEX. 


Santa  Clara  County  Fruit  Exchange,  Success 

of,  481. 
Santa  Clara  Valley,  fruit  marketing  societies 

of,  476,  480. 
Sauerbeck,  A.,  index  table  of,  641. 
Science,  rests  upon  verified  facts,  20. 

—  What  it  has  done  for  the  farmer,  34. 
Science  in  Agriculture  ;  incident  showing  feel- 
ing of  some  farmers  in  regard  to  it,  29. 

—  Incident  showing  its  progress,  34. 

—  Until  lately  neglected  in  America,  30. 

—  What  it  is  and  is  not,  30. 

—  What  It  has  effected,  31. 

—  Work  of  the  different  professions,  33,  34. 
Scientific  knowledge  expensive,  31. 
Scientific  Men  ;  the  only  really  practical  men, 

20. 

—  Their  patience  in  the  study  of  detail,  20. 
Senators,  United  States;    effects  of  contest 

for  that  office,  116. 
Service,  civil,  192-194. 

—  Civil ;  not  an  aristocracy,  194. 

—  Public;  abuses  in  connection  with,  190,  191. 

—  Public;  how  to  reform  it,  192-194. 

—  Public ;  responsibility  for  abuses  in,  192. 
Settlers,   early;  entitled  to  advance  in  land 

created  by  their  enterprise,  107. 
Shiftless  boys;  probably  defectives,  92. 
Short  Courses  in  Agriculture,  51. 

—  Individual  guidance  given,  51. 

—  Lead  to  no  degree,  51. 

—  No  special  preparation  required,  51. 

—  Students  at  least  learn  how  much  they  do 

not  know,  52. 

—  Students  must  be  mature,  51. 
Silver,  a  commodity,  368,  632. 
Silver,  coinage  cf,  624. 

—  Changes  of  legal  ratio  in  U.  S.,  357,  621. 

—  Demonetization  of,  622. 

—  Free  coinage  of,  363. 

—  Free  coinage  of;  argument  for,  376-382. 

—  Free  coinage  of ;  as  law  stands  U.  S.  would 

have  to  maintain  ratio  of  16  to  i,  365. 

—  Free  coinage  of ;  proper  method  of  study- 

ing the  question,  382. 

—  Justice  of  free  coinage  of,  376. 

—  Legal  tender  for  U.  S.  bonds  and  private 

debts,  364. 

—  London  price  of,  624, 633. 

—  Purchases  of,  623. 

—  Questions  concerning  not  fairly  discussed 

by  political  writers  or  speakers,  3S2. 

—  Ratio  of  to  gold,  618-622. 

—  Relation  of  to  commodities,  369. 

—  Results  of  free  coinage  of  uncertain,  382. 

—  See  ratio  and  coinage. 

—  Standard,  effect  on  lAie  Insurance,  375. 

—  U.  S.  unable  to  sustain  price  of,  362. 

—  Value  as  compared  with  gold,  356. 

—  Value  of ;  must  be  restored   by   inspiring 

confidence  in  it,  380. 

—  World's  production  of,  617. 

—  World's  stock  of,  616. 

Single  Tax,  as  a  means  of  social  reform,  329. 

—  As  advocated  by  Henry  George,  340. 

—  As  a  fiscal  measure,  335. 

—  As  it  would  work  on  the  basis  of  Califor- 

nia assessments,  336-340. 

—  Claims  of  its  advocates,  324-326. 

—  Definition  of,  324. 

—  If  just  should  be  adopted,  329. 

—  Lack  of  data  for  estimating  result  of,  327. 

—  Not  a  new  doctrine,  340. 

—  Reply  to  arguments  for,  325. 

—  Result  of,  to  farmers,  327. 

—  Similar  to  one  of  the  doctrines  of  Social- 

ism, 325. 
Socialism,  attitude  of  the  farmer   towards, 
432. 


Socialism;  cooperation  differs  from,  203. 

—  Demands  of,  424. 

—  Fallacy  of,  429. 

—  Good  it  has  accomplished,  425. 

—  Grandeur  of  conception  of,  425. 

—  If  established  must  be  based  on  rural  and 

not  urban  life,  427. 

—  Not  reconcilable  with  rural  life,  433. 

—  Not  to  be  lightly  reckoned  with,  424. 

—  Propositions  on  which  it  rests,  423. 
— ■  Ranks  of  include  good  men,  424. 

—  Relations  of  to  organized  labor,  427. 

—  Relation  of  to  cooperation,  428. 

—  Reply  to  claims  of,  426-427. 

—  Some  of  its  aims  favored  by  non-Socialists, 

425. 

—  Ultimate  aims  of,  423. 

—  What  it  necessarily  implies,  424. 
Socialistic    Labor    Party,    demands    of    not 

Socialism,  394-395- 
Social  Reform,  discussion  has  centered  about 
urban  interests,  42. 

—  Discussion  of  not  unprofitable,  422. 

—  Farmers  ignored  in  plans  for,  423. 

—  Must  begin  with  rural  life,  423. 

—  Probability  of,  432. 

Social  Reforms,  many  proposed  overlook  in- 
firmities of  human  nature,  25S. 

Social  Intercourse,  an  important  economic 
factor,  99. 

—  Difficulties  attending  it  in  rural  districts, 

96. 

—  Essential  to  a  happy  life,  96. 

—  How  best  promoted  in  rural   districts,  98. 

—  If  left  unregulated  tends  to  deterioration, 

99. 

—  Lacking  in  farm  life,  96. 

—  Should  be  enjoyed  by  young  and  old   to- 

gether, 97. 

—  The  labor  falls  mostly  on  women,  98. 

—  The  lack  of  it  one  cause  of  the  farmer's 

discontent,  97. 

—  The  young  must  and  will  have  it,  97. 
Society,  an  uncompleted  evolution,  37. 
Soetbeer,  A.,  index  tables  of,  643. 
Southern  Calilornia,  orange  industry  of,  505. 
Southern  California    Deciduous    Fruit    Ex- 
changes, expenses  of  organization  of,  486. 

—  Organization  of,  485. 

Southern  California  Fruit  Exchanges  (Cit- 
rus), 505. 
—Beginning  of  business  of,  512. 

—  Character  of,  509. 

—  Conditions    leading   to    organization    of, 

566-508. 

—  Difficulties  of,  513-514- 

—  Methods  of,  513. 

— Organization  of,  510. 

—  Success  of,  514. 

Soil,  analysis  of;  its  use  and  value  in  agri- 
culture, 69. 

—  Drainage  of,  87. 

—  Importance  of  physical  condition  of,  87. 

—  Result  of  leaving  it  naked,  86. 

—  Should  be  kept   constantly   covered  with 

growing  plants,  86. 
Special  Agricultural  Schools,  51. 
Speculators,  conflict  of  bulls  and  bears,  177. 
Speculation,  effects  of  reaction  from  on  land 

values,  loS. 

—  How  conducted  on  Exchanges,   178. 

—  In    farm    products;    results   to   farmers, 

179-180.  * 

—  Its  effects  on  American  farmers,  107. 

—  Meaning  of,  176. 

—  Most  effective  method  of  suppressing,  181. 
Speculators,  different  classes  of,  176. 
Standard  of  Life,the  farm  the  farmer's  stand- 
point, 124. 


INDEX. 


66] 


standard  of  Life;  the  farmers',  123. 

—  Essential  nature  of,  368. 
Standard  of  Value,  best  available,  370. 
Statistics,  caution  in  regard  to  use  of,  611. 

—  Of  currency,  authorities  for,  613. 
Stores,  Cooperative,  210. 

—  How  made  successful,  214. 
Strikes,  causes  and  results  of,  386. 

—  Duty  of  society  with  regard  to,  387. 

—  Great  seldom  peaceful,  5S7. 

—  Peaceful,  a  legitimate   proceeding  when 

necessary,  386. 

—  Responsibility  for  riots  in,  387. 
Struggle,  absence  of  is  death,  127. 

—  For  existence,  loi. 
Study  of  the  I'arm,  76. 

—  A  study  as  the  author  would  conduct  it,  78. 

—  A  study  as  Mr.  Clinton  would  make  it,  82. 

—  Advantage  of  crops  largely  produced  in 

the  vicinity,  80. 

—  Consists  in  finding  out  the  essential  things 

that  are  not  already  known,  77. 

—  It  involves  a  study  of  costs,  78. 

—  It  is  the  waste  of  effort  that  kills,  8r. 

—  If  a  good  farm  does  not  pay,  the  fault  is 

with  the  farmer,  78. 

—  No  two  men  would  proceed  in  the  same 

way,  76. 

—  The'farm  the  only  place  to  learn  farming, 

76. 

—  The  farmer  must  be  honest  with  himself, 

77- 

—  The  greatest  of  all  means  of  self-improve- 

ment, 76. 

—  The  many  things  which  all  farmers  know 

about  their  farms,  77. 

—  The  need  of  the  capacity  to  see  things,  77. 
Subsistence,  sufficient  produced  for  all,  22. 
Success,   farmer  who  c  oustantly  changes  his 

products  cannot  achieve  it,  S8. 

—  Probable,  best  evidence  unusual  effective- 

ness, 92. 
Survival  of  the 'Fit,  21. 

—  Evidence  of  power  of,  24. 

—  Power  of  in  American  farmer.  24. 
Syndicates,  agricultural,  604. 


TABLES,  Index    (see  Index  Tables). 
Tax,  single  (see  Single  Tax). 
Taxation,  ad  valorem,  can  not  be  made  just, 
329- 

—  At^ected  by  political  action,  115. 

—  A  very  difficult  subject,  334. 

—  Difl^culty  of  levying  justly,  296. 

—  Double,  333. 

—  Extravagance  in,  188. 

—  Evaded  by  rich  men,  329-331. 

—  In  America,  295. 

—  In  California,  336. 

—  Incidence  of,  300. 

—  Inequalities  of.  188. 

—  Injustice  of  in  U.  S.,  297. 

—  In  U.  S.  in  1890,  335. 

—  Limit  of,  187. 

—  Men  will  lie  to  evade  it,  188. 

—  Methods  of  in  highly  taxed  countries,  296. 

—  Not  adequately  studied  in  U.  S.,  296. 

—  Of  Chicago  banks,  330. 

—  Of  Chicago  land,  334. 

—  Of  money,  331. 

—  Of  mortgages,  333. 

—  Of  personal   property  opposed    by    many 

who  are  not  single  taxers,  331. 

—  Of  stocks,  332. 

—  Perjury  to  escape,  330. 

—  Present  system   very    unjust  to  farmers, 

329- 


Taxation,  pressure  of  in  U.  S.,  187. 

—  Ratio  of   assessed  on  land  and  personal 

property,  335. 
Taxes,  export  prohibited  in  U.  S.,  297. 

—  Indirect,  298-301. 

Tender,  legal  jfsee  Legal  Tender). 
Theorists,  common  errors  in  regard  to  them. 
29. 

—  Real  meaning  of  the  term,  29. 

—  What  some  farmers  suppose  them  to  be, 

29. 
Tillage,  thorough,  results  of,  8g. 
Tariff,  as  affected   by  conflicts   of  sectional 

interest,  302. 

—  As  a  part  of  a  revenue  system,  295. 

—  As  a  (luestion  of  the  day,  294,  301. 

—  Details  are  matters  of  expert  knowledge, 

303- 

—  For  protection,  301. 

—  Legislation  in  U.  S.  before  and  after  Civil 

War,  297. 

—  Party  platforms  on,  295. 

—  Problems  of,  how  complicated  in  U.  S.,302. 

—  Objects  of  the  chapter  on,  295. 

—  Opinions  on, how  formed  and  changed,  302. 

—  Position  of  extremists  on  both  sides,  294. 

—  Protective,   nature  of  popular  discussion 

on,  306. 

—  Protective,  summary  of  arguments  against, 

309,  310- 

—  Protective,    summary   of   arguments   for, 

307.  3oS- 

—  Protective,  usual  argument  for,  304. 

—  Reasoning  of  most  economists  on,  303. 

—  Relation  of  balance  of  trade  theories  to, 

310,  312- 

—  Reply  to  the  reasoning  of  free  trade  econo- 

mists, 304. 

—  The  kind  we  all  really  desire,  302. 
Trade,  balance  of,  310-312. 

—  Retail  ;   everywhere   infected   with   fraud, 

185. 
Tradesman,     country,     must    charge     high 

prices  if  he  sells  on  credit,  183. 
Tradesmen  ;  danger  of  debt  to  them,  185. 

—  Dealings  of  Granges  with,  184. 

—  How  fanners  should  deal  with  them,  183. 

—  Retail,  economic  value  of  to  farmers,  183. 

—  Retail,  profits  of,  1S2. 

Trade  I'liioiiisni,  aims  of,  385,  428. 
Transportaiion,  cost  of.  646. 

—  Study  "f  problems  in,  158. 
Transportation  System  ;  affect  of  its  develop- 
ment on  land  prices  and  speculation,  108. 

Trusts,  American,  648. 

—  A    permanent   feature  of  civilization,  397. 

—  As  originally  conceived  not  now  existing, 

396- 

—  Can  not  be  prevented  without  paralyzing 

business,  411. 

—  Causes  leading  to  their  formation,  399. 

—  Danger  of  inllammatory  methods  of  treat- 

ing them,  .;ii. 

—  Debauching    politics,   their    most   serious 

abuse,  406. 

—  Desirable,  if  controlled,  otherwise  not,  408. 

—  Doing  nothing  that  farmers  would  not  like  • 

to  do,  399. 

—  Entitled  to  have  no  business  secrets,  408. 

—  Farmers    should    lead    the  campaign   for 

their  control,  412. 

—  Fear  the  people  more  than  the  people  fear 

them.  412. 

—  First  step  towards  their  control,  406. 

—  How  ionncd  at  present,  397. 

—  Improper  use  of  money  to  control  political 

action,  405. 

—  Industrial,  how  enabled  to  thrive,  406. 

—  Legislation  for  control  of,  408. 


,662 


IXDEX. 


Trusts,  methods  of  accomplishing  their  ends, 
405. 

—  Must    be   considered    without    prejudice, 

368. 

—  Not  harmed  by  wild  denunciation,  411. 

—  Of  farmers  and  others  alike,  399. 

—  Of  farmers  need  encouragement,  399. 

—  Origin  of  common  use  of  the  term,  396. 

—  Popular  meaning  of,  396. 

—  Present  conditions  ridiculous  and    should 

be  changed,  40S. 

—  Present  generation  not  likely  to  deal  with 

them  wisely,  409. 

—  Present  rapid  formatioii  of  largely  specula- 

tive, 410. 

—  Problems  in  connection  with,  397. 

—  Protected  by  patents  and  lariff,  403,  404. 

—  Relations  to  political   parties    and   politi- 

cians, 405,  406. 

—  Should  be  formed  by  farnurs.  398. 

—  Special  methods  of  control  of,  412. 

—  Speculative,  how  formed,  410. 

—  Speculative,   will   fleece    investors    rather 

than  the  public,  411. 

—  Sugar,  399.  . 

—  Those  first  formed  ineflfective,  399. 

—  The  ideal  result  of  cooperative  marketing, 

203. 

—  To  be  defied— not  feared,  412. 

—  We  all  desire  to  be  in  them,  411. 


Trusts,  will  control  most  articles   purchased 
by  farmers,  404. 


UNEARNED   INCREMENT,    program   for 
reserving  it  to  society,  432. 

—  Tends  to  be  reabsorbed  by  society,  431. 
United  States;  credit  of  during  the  Rebellion, 

142. 

—  Nommally    bi-metallic,    really   on    a    gold 

basis,  363. 
Union,  Latin,  360. 

I'niversity,  cost  of  maintaining,  40. 
Unthrifty,  the  ;  end  of,  139. 

VALUES,  Of  land  speculative  in   U.  S.,  32S. 
Vigor;  the  source  of  all  prosperity,  25. 

WAGES,  Course  of,  625. 
Walnut   Marketing  Associations,  of  Califor- 
nia, 4S7. 
West  Side  Fruit  Union,  473. 

—  Success  of,  474. 

Wetn^ore,  W.  S.,  index  table  of  silver  pricesin 

Ciiina,  644. 
Wine,  in  California,  518. 

—  Method  of  making,  517. 

Work,  public;  should  be  let  by  contract,  195 


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^"^^  STAMI^D  BELOW 

AN  INITIAL  FINE  OF  25  CENTS 

AN    iJNlXA«-"  RETURN 

W.UU  BE  ASSESSED  FOR  FAILURE  TO    ^^^^^ 

THIS  BOOK  °Vxo  50  cIn?s  ON  THE  FOURTH 
:;^V^;r  TO^  -  ol  ON  -E  seventh  O.V 
OVERDUE. 


LD  21-100m-7,'33 


W^SljXt^  DcnrvcLCT  LmnM«lt; 


CD25b2T33fl 


HOME  USE     '  '3 


9  1989  ^  


FORM  NO,  0D6 


'"^^^^^^^^^^^^^u^S^ 


BERKELEY,  CA 


94720 


BERKELEY 


fiih! 


